Petitioner's Brief and Explanation of Evidence 25-003108.pdf

J & S Farms LLC, Petitioner V Township Of Holland, Respondent · 25-003108-TT

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STATE OF MICHIGAN

DEPARTMENT OF LICENSING & REGULATORY AFFAIRS

MICHIGAN ADMINISTRATIVE HEARING SYSTEM

MICHIGAN TAX TRIBUNAL

SMALL CLAIMS DIVISION

______________________

J & S FARMS LLC,

Petitioner,

TOWNSHIP OF HOLLAND,

Respondent.

MOAHR Docket No. 25-003108

Parcel No. 70-16-04-200-004

______________________________________________________________________________

Thomas K. Dillon (P81136)

FOSTER SWIFT COLLINS & SMITH, P.C.

Attorneys for Petitioner

1700 East Beltline Avenue NE, Suite 200

Grand Rapids, MI 49525

(616) 726-2258

tdillon@fosterswift.com

Bradley J. Fisher (P64608)

SCHOLTEN FANT

Attorney for Respondent

100 N. Third Street

Grand Haven, MI 49417

(616) 842-3030

bfisher@scholtenfant.com

______________________________________________________________________________________

PETITIONER’S BRIEF AND EXPLANATION OF EVIDENCE

Petitioner, J & S Farms LLC, by and through its attorneys, Foster Swift Collins & Smith,

P.C., submits this brief and explanation of evidence in support of the Petition.

Introduction

The property at issue is an approximately 5.6 acre farm in Holland Charter Township,

property parcel number 70-16-04-200-004 (the “Property” or “Subject Property”). The Property

contains a farmhouse and is largely used for the production of crops such as soybeans and hay. A

GIS photograph of the Property is included as Exhibit P-1. Prior to August of 2024, Mary J.

Nienhuis, in her capacity as trustee of the Larry Allen Nienhuis Living Trust and Mary Jane

Page 2

Nienhus Living Trust (“Ms. Nienhuis”), owned the Property. Throughout her ownership, and even

though the property was receiving the Principal Residence Exemption (“PRE”), more than 50% of

the Property’s acreage was devoted to agricultural purposes. In August of 2024, Petitioner

purchased the Property, filed an affidavit attesting that the Property will remain qualified

agricultural property,1 and has continued to farm the Property. Nevertheless, Respondent uncapped

the Property’s taxable value for the 2025 tax year. Exhibit P-2, March Board of Review Decision.

Notably, there does not appear to be any dispute regarding whether the Property is “qualified

agricultural property” as Respondent has granted the Qualified Agricultural Exemption (“QAE”)

for 2025. Exhibit P-3, Notice of Assessment.

The facts in this case are not in dispute. Instead, this appeal involves a singular legal issue:

does the taxable value of property that is “qualified agricultural property” at the time of transfer

uncap where the transferee complies with the requirements of MCL 211.27a(7)(o)? Petitioner

contends that the uncapping violates MCL 211.27a(7)(o).

The Property has been, for all years relevant to this appeal, classified as residential. The

Property has been continuously devoted to agricultural purposes since at least 2000. Despite its

classification as residential, more than 50% of the Property’s acreage is devoted to farming and

therefore, the parcel is “qualified agricultural property” under MCL 211.7dd(d). Because the

Property was (prior to Petitioner’s purchase), and continues to be, “qualified agricultural property,”

Petitioner’s purchase of the Property was not a transfer of ownership under MCL 211.27a(7)(o).

Respondent’s uncapping was contrary to law.

1 MCL 211.27a(7)(o).

Page 3

Factual Background

The relevant facts are not in dispute. For 2024 and 2025, Respondent classified the

property as residential and granted the QAE for tax year 2025.2 In 2024, Petitioner purchased the

Property from Ms. Nienhuis. Prior to the 2024 purchase, and since at least 2000, Ms. Nienhuis

devoted more than 50% of the Property’s acreage to agricultural purposes, which included growing

and harvesting crops such as soybeans and hay. Exhibit P-4, Affidavit of Mary J. Nienhuis.

Despite its agricultural use, prior to 2025, the property was receiving the PRE.3 Ms. Nienhuis was

unaware of any distinction between the QAE and the PRE.4

Upon purchasing the Property, Petitioner filed an affidavit attesting that the Property was

qualified agricultural property and would remain qualified agricultural property as required by

MCL 211.27a(7)(o). Exhibit P-5, Agricultural Affidavit. Since its purchase, Petitioner has

continued to use the same portion of the Property for agricultural purposes as the prior owner.

Currently, soybeans are being grown on the Property.

Law and Analysis

The issues in this case turn on statutory interpretation. When courts interpret statutes, they

first look to the specific statutory language to determine the intent of the Legislature. City of Grand

Rapids v Brookstone Capital, LLC, 334 Mich App 452, 459; 965 NW2d 232 (2020). Where the

statutory language is unambiguous, the plain meaning controls and judicial construction is not

permitted. Universal Underwriters Ins. Group v Auto Club Ins. Ass’n., 256 Mich App 541, 544;

666 NW2d 294 (2003).

2 Exhibit P-3.

3 Exhibit P-4.

4 Exhibit P-4.

Page 4

Though it is often stated that tax exemptions are to be strictly construed in favor of the

taxing unit, the Michigan Supreme Court, in TOMRA of North America, Inc v Dep’t of Treasury,

505 Mich 333, 343; 952 NW2d 384 (2020), recently clarified this “standard” and held that the

judicially-created canon requiring strict construction is one of last resort and should only be

employed when an act’s language, after subjection to the ordinary rules of interpretation, presents

ambiguity. TOMRA, supra, at 343. In other words, where the statute is unambiguous, the plain

language controls and there is no “strict construction” in favor of the taxing unit.

Here, strict construction is inapplicable for the same reason it was in TOMRA: the statutory

language regarding the definition of “qualified agricultural property” (MCL 211.7dd(d)) and when

a transfer of “qualified agricultural property” results in a “transfer of ownership” (MCL

211.27a(7)(o)) is unambiguous.

The Subject Property was “Qualified Agricultural Property” prior to 2024.

Under MCL 211.7dd(d), “qualified agricultural property” means “unoccupied property and

related buildings classified as agricultural, or other unoccupied property and related buildings

located on that property devoted primarily to agricultural use.” (emphasis added). Under

MCL 211.7ee(2), “[q]ualified agricultural property that is classified as agricultural under section

34c is exempt . . . .” Therefore, farmland property with a home on it classified as agricultural

meets the definition of “qualified agricultural property.” See Phelps v Courtland Township, MTT

Docket No. 16-002057 (May 2, 2017) (attached as Exhibit P-6).

In addition to being classified as agricultural, property may be “qualified agricultural

property” if it is devoted primarily to agricultural use. Property is devoted primarily to agricultural

use if “more than 50% of the parcel’s acreage is devoted to agricultural use.” MCL 211.7dd(d).

The Court of Appeals has specifically held that property not classified as agricultural may still be

“qualified agricultural property” due to agricultural use:

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Under MCL 211.7dd(d), property that is not classified as agricultural

is considered “qualified agricultural property” if more than 50% of

the parcel’s acreage is devoted to agricultural use, with the term

“agricultural use” being defined in MCL 324.36101. . . . In this case,

because the property was classified as residential, its QAE is based

on use of the property, not its classification.

Hoffman v Township of Highland, unpublished per curiam, COA No. 348939 (August 13, 2020)

(emphasis added) (attached as Exhibit P-7).

As established by Ms. Nienhuis’ Affidavit, more than 50% of the Property’s acreage was

farmed throughout her ownership. The Property was, therefore, “qualified agricultural property”

as defined by the GPTA regardless of whether Ms. Nienhuis had requested, or the Township had

granted, the QAE. The property’s classification as residential property does not alter this

conclusion. Whether property qualifies as “qualified agricultural property” depends on whether it

satisfies the requirements of MCL 211.7dd(d). The evidence demonstrates that those requirements

were met both before and after Petitioner’s purchase of the Property.

II.

Petitioner’s 2024 purchase of the Subject Property is not a transfer of ownership

under MCL 211.27a(7)(o).

Under MCL 211.27a(7)(o), a transfer of ownership does not include:

[A] transfer of qualified agricultural property, if the person to whom

the qualified agricultural property is transferred files an affidavit

with the assessor of the local tax collecting unit in which the

qualified agricultural property is located . . . attesting that the

qualified agricultural property will remain qualified agricultural

property.

The statute does not require that the property must have been classified as agricultural prior to the

purchase. The statute does not require that property must have been receiving the qualified

agricultural exemption prior to the purchase. Instead, the statute requires only that the property

transferred be “qualified agricultural property” and that the transferee files the requisite affidavits

for the property to be exempt from uncapping.

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6 

 

Prior to Petitioner’s 2024 purchase, though the subject property was classified as 

residential, more than 50% of the property was used for agricultural purposes – primarily the 

growing and harvesting of soybeans and hay.5 After Petitioner purchased the farm from Ms. 

Nienhuis, Petitioner promptly filed an affidavit for the parcel under appeal attesting that the 

qualified agricultural property shall remain qualified agricultural property.6 Because the property 

was “qualified agricultural property” before the purchase, and because Petitioner filed the 

statutorily-required affidavit, Petitioner’s purchase was not a transfer of ownership under MCL 

211.27a(7)(o). 

 

In Phelps v Courtland Township, supra, the Tribunal addressed a case involving a similar 

set of facts. In Phelps, the property at issue was classified as residential from 1999 through 2016 

and did not receive the qualified agricultural exemption prior to 2011.7 Though the property was 

not classified as agricultural prior to 2016, when the petitioner purchased the property and filed 

the affidavit, the petitioner sought a revision of the property’s taxable value to the value it would 

have been had no transfer occurred between 1999 and 2016 under MCL 211.27a(8).8 The 

Township argued that the property must have been actually receiving the qualified agricultural 

exemption in the previous years for the “recapping” provision of MCL 211.27a(8) to apply.9 

 

The Tribunal rejected the Township’s argument. In so doing, the Tribunal first addressed 

MCL 211.27a(7)(o): 

There is also no requirement that the property have a qualified 

agricultural exemption. Rather, the statute merely requires the 

property to be “qualified agricultural property” and indicates 

that said status can “cease” at any time, which is consistent with the 

 

5 Exhibit P-4. 

6 Exhibit P-5. 

7 Id. 

8 Id. 

9 Id.

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7 

 

requirements for granting and rescission of the qualified agricultural 

exemption. 

Phelps, supra (emphasis added). The Tribunal further recognized that the definition of “qualified 

agricultural property” requires: 

[T]he property to either be classified as agricultural property or that 

the property be primarily devoted to agricultural use.10 

The Tribunal determined that, based on affidavits filed by the petitioner, the property met the 

definition of “qualified agricultural property” in 1999 and each year thereafter because it was 

devoted primarily to agricultural use even though the property was not classified as agricultural in 

each of those years.11 Therefore, the property was entitled to a recapping. Though decided through 

the lens of MCL 211.27a(8),12 the Phelps decision confirms that a property’s prior receipt of the 

QAE is not a prerequisite to being “qualified agricultural property.” 

The Michigan State Tax Commission (“STC”) agrees. The STC’s Transfer of Ownership 

Guidelines confirm that property may qualify for the qualified agricultural property transfer of 

ownership exemption even where it is not receiving the qualified agricultural property exemption: 

A parcel is 100% qualified agricultural property and could receive a 

100% qualified agricultural property exemption. However, the 

owner, who lives on the parcel, claims the homestead exemption so 

that he can also claim a homestead exemption on contiguous vacant 

property. If this parcel is transferred, could the new owner benefit 

from the qualified agricultural property transfer of ownership 

exemption even though the property is not receiving the qualified 

agricultural property exemption? 

Yes, provided that the new owner files the required affidavit with 

the local assessor and the register of deeds attesting that the property 

will remain qualified agricultural property. Statute requires that a 

property be qualified agricultural property to be eligible for this 

transfer of ownership exemption. It is not required that the 

 

10 Id., relying on the definition of “qualified agricultural property” in MCL 211.7dd(d). 

11 Id. 

12 The parties agreed that the 2016 transfer was not a transfer of ownership under MCL 211.27a(7)(o) because the 

property was “qualified agricultural property” and the petitioner filed the requisite affidavit claiming the exemption. 

Id.

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8 

 

property be receiving the qualified agricultural property 

exemption to be eligible for this transfer of ownership 

exemption. 

Michigan State Tax Commission, Transfer of Ownership Guidelines, (attached as Exhibit P-8) 

(bold emphasis added, underline in original). 

 

Under Phelps, Hoffman, the relevant provisions of the General Property Tax Act (MCL 

211.7dd(d), 211.7ee(2), 211.27a(7)(o)), and the STC’s Transfer of Ownership Guidelines, 

Respondent’s classification of the property as residential or granting of the PRE is not dispositive 

as to whether the property was “qualified agricultural property” for purposes of MCL 

211.27a(7)(o). Instead, the property is “qualified agricultural property” if more than 50% of the 

property is devoted to agricultural use. MCL 211.7dd(d); Phelps, supra. Here, it is undisputed 

that, prior to Petitioner’s purchase, more than 50% of the acreage of the Property was devoted to 

farming.13 The Property was “qualified agricultural property.” MCL 211.7dd(d). When Petitioner 

purchased the Property, it filed the affidavit required by MCL 211.27a(7)(o).14 Petitioner’s 

purchase was therefore not a transfer of ownership. Respondent’s uncapping was contrary to MCL 

211.27a(7)(o). 

III. 

Respondent’s interpretation that only property actually receiving the QAE is not 

subject to uncapping violates uniformity of taxation. 

The Michigan Constitution mandates that property taxes be uniform. Const 1963, art 9, § 

3; see also WPW Acquisition Co v City of Troy, 250 Mich App 287, 303; 646 NW2d 487 (2002) 

(“[a]ll kinds of property must be taxed uniformly, or be entirely exempt”). Respondent’s 

contention, however, would violate uniformity by treating some “qualified agricultural property” 

differently than other qualified agricultural property. To Respondent, whether or not the property 

 

13 Exhibits P-4. 

14 Exhibit P-5.

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9 

 

was continuously and primarily devoted to agricultural use is irrelevant if the assessor incorrectly 

classifies the property as residential and a farmer is unaware of the qualified agricultural 

exemption. While an older farmer may not see the difference in his property taxes if the assessor 

assigns a PRE to farmland, a new farmer continuing that agricultural use would be treated 

differently from similarly situated farmers without the misclassification. That is exactly the harm 

in this case. Under Respondent’s view, similarly situated farmers are treated differently solely 

based on assessing and tax administration actions preceding their purchase of the property, and not 

based on the actual use of the property. 

Respondent’s interpretation results in precisely the same harm that the Legislature sought 

to avoid when it enacted MCL 211.27(7)(o), which was a product of Public Act 260 of 2000 (“PA 

260”). Prior to the adoption of PA 260, the taxable value of farm property was uncapped upon a 

transfer. This resulted in a sharp property tax increase for farmers, as noted in the Senate Fiscal 

Agency’s Bill Analysis of SB 709 and 1246 (which would become PA 260 and PA 261 of 2000): 

It has been pointed out that this increase in property taxes can be 

particularly burdensome to those purchasing farm property, because 

such sales usually involve substantial tracts of valuable land. 

Exhibit P-9. 

This tax increase concerned the Legislature, in part because a report by the Senate 

Agriculture Preservation Task Force concluded that “the farm sector is in the worst condition it 

has been in since the mid-1980s; prices for many commodities are as low as they have been in 

decades; few young people are entering agriculture; and economic pressures on farmers … are 

causing agricultural resources, including land, to be removed from farm production.”15 The report 

recommended that, “the assessment on transferred agricultural property should remain capped if 

 

15 Exhibit P-10.

Page 10

the new owner keeps the property in agricultural use, encouraging new farmers and limiting the

conversion of farmland to other uses.” Id. (emphasis added).

The Bill Analysis further explained the impact on farmers:

Since the 1994 passage of Proposal A, which created a new State school funding

system, there has been an assessment cap that limits a parcel's annual assessment

increase to the rate of inflation or 5%, whichever is less. The assessment cap has

led to substantial differences between the taxable value of farmland and its SEV

(based on market value). While this has kept taxes lower than they otherwise would

be, the cap is lifted when property is transferred. This means that if a young

farmer wants to purchase a farm from a retiring farmer, the assessed value of

the property - - and the taxes on it - - will "pop up" upon transfer of the land.

By ensuring that, when transferred, farm property will continue to be assessed

based upon its capped value rather than its open-market value, Senate Bill 709 will

prevent farmers' property taxes from rising dramatically, and thus will increase the

farmers' chances of remaining profitable.

. . .

The State should take steps to ensure that agriculture remains a vital part of

Michigan's economy, and to do that the State must do what it can to help farmers.

By implementing one of several recommendations made by the Task Force to

provide substantial tax relief to farmers, Senate Bill 709 will help to keep

farmland as farmland.

Exhibit P-9 (emphasis added).

Clearly, the purpose of Senate Bill 709 was to “help to keep farmland as farmland” and

“prevent farmers’ property taxes from rising dramatically” upon a sale from one farmer to another.

New farmers have no control over the local unit’s prior classification of the property, but they can

control the continued use of the property as farmland, which is what the Legislature specifically

sought to promote by adopting PA 260 and PA 261. Different treatment of otherwise identical

farmland depending solely on an assessor’s previous classification runs afoul of uniformity. It is

Page 11

incompatible with the Legislature’s express desire to encourage new young farmers to purchase

farms and thereby prevent the statewide loss of farmland.

The Uniformity Clause requires Respondent to show that the different treatment of

members within the same class is supported by a rational basis. Armco Steel Corp v Dep’t of

Treasury, 419 Mich 582, 592; 358 NW2d 839 (1983). (“in cases involving taxing statutes, there

is no discernible difference between the Equal Protection and Uniformity of Taxation Clauses.

Some rational basis for a disputed classification must be shown to exist”).

There is no rational basis for Respondent’s different treatment of similarly situated farmers.

Respondent would treat similarly situated farmers differently depending on whether the local

assessor classifies an older farmer’s property as agricultural or residential. On its face, this

difference is arbitrary and lacks any rational basis. In this case in particular, the distinction has no

rational basis given the undisputed evidence that more than 50% of the subject property has been

continuously devoted to agricultural purposes for the entire period in question. Respondent's

position would result in different tax treatment for otherwise identical farms based solely on

whether the owner was aware of and claimed the qualified agricultural property exemption.

In the simplest terms, the taxable value of farmland is not uncapped so long as farmland

remains farmland – which is precisely what the Legislature intended to accomplish in adopting PA

260.

Conclusion

The GPTA’s statutory scheme for the uncapping of qualified agricultural property is clear.

Transfers of “qualified agricultural property” where a transferee files the requisite affidavits

attesting that the property will remain “qualified agricultural property,” are not transfers of

ownership under MCL 211.27a(7)(o). Property may be “qualified agricultural property” if

Page 12

classified as something other than agricultural and more than 50% of the property’s total acreage

is devoted to agricultural use.

Here, the Property is “qualified agricultural property” under MCL 211.7dd(d). Prior to

Petitioner’s purchase, Ms. Nienhuis devoted more than 50% of the parcel to the production of

crops. The Property therefore was “qualified agricultural property” prior to Petitioner’s purchase,

regardless of the assessor’s classification and regardless of whether it actually received the QAE.

When Petitioner purchased the Property, it filed the affidavit required by MCL 211.27a(7)(o)

attesting that the property was, and will remain, “qualified agricultural property.” Petitioner’s

purchase was not a transfer of ownership and Respondent’s uncapping was contrary to law. MCL

211.27a(7)(o).

WHEREFORE, Petitioner respectfully requests that this Tribunal: (1) reverse Respondent’s

uncapping of the Subject Property’s taxable values and require that Respondent revise the

property’s taxable value to $132,506; and (2) grant any other relief that the Tribunal deems fair,

just and equitable.

Respectfully submitted,

FOSTER SWIFT COLLINS & SMITH PC

Attorneys for Petitioner

Dated: September 30, 2026

By:

___________________________

Thomas K. Dillon (P81136)

1700 E. Beltline Ave. NE, Suite 200

Grand Rapids, MI 49525

(616) 726-2258

tdillon@fosterswift.com

27415:00006:203067798-2

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MTT Docket No. 25-003108 

October 21, 2026 

P1-001

et 

No. 

25-00 

October 21, 

=

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MTT Docket No. 25-003108 

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P2-001

- 

08 

MTT Docket No. 25-0031 

October 21, 2026 

Steer 

© 

J 3 REVIEW DECISION 

Boia 

HOLLAND CHARTER TOWNS Hyp 

353N 120TH AVE 

HOLLAND, MI 49424 

NAME AND ADDRESS (Ff OWNER OR PERSON NAMED 

ON ASSESSMENT ROLL: 

PROPERTY: IDENT 

: 

HON: 

(Parcel 

Coe 

rer 

and leg) descripting Bptisial ; 

(Parcel Code quired 

| 

70-1 0-04-20) 

12120 NEw HOLLAND 

PART OF 11: 

hy: pg VSCOM ATTEN 114 cop TIS 881 

BIMIIS E1508 80 17 

Ap 

or 

I OF BEG, 

1] 

CONT'S 

881) 370 

395 

1: ST0.25 

IT THS 

01 20M 115 

660.08 

FTALG W LL of 

1 

3 RDS OF NE 14.01 

NE Ry. 

11 IHN 

88D 37M 328 W369 52 FIALGS| 1OFN 660 

171 OF 

NE 

1/4 0f 

NE IRI. ATH N 0D 25M 228 EB 660.09 F110) BEG. SE¢ 

1 TSN 

RISW 5.6 AC 

(RESIDENTIAL-IMPROV ED) 

"OPCNty address 

J&S FARMS LLC 

12120 NEW HOLT Ap 

HOLLAND My g945y 

>) 

> 

2 

= 

S PROPERTY is CLASSIFIED 

401 

"hank you for attending this years March Board Of Review. The Board has reviewed the information You supplied and the data necessary 

10 compute your assessment and taxable value, 

: 

The Board has completed their review Of parcel number 

70-1 6-04-200-004 

They haye made the following determination based on the information you supplied. 

Board of Rey iew Comments 

2025 

ORIGINAL ASSESSED VALUE 

242.900 

2025 

“BOARD OF REVIEW" ASSESSED VALUE 

242.900 

al 

(If the above amounts are the same, no revisions have occured) 

[2025 ORIGINAL TAXABLE VALUE 

242.900 

] 

[2025 

"BOARD OF REVIEW" TAXABLE VALUE 

242.900 

[2025 

PRINCIPAL RESIDENCE EXEMPTION/QUALIFIED AG 

100.0000 

x 

Please fee] free to contact the assessor at the address listed above or call if you have any questions, 

RE 

5. 

Rather, you are required 

to file a 

petition 

to 

‘Effective 

March 

1. 

2013, 

the Tribunal is no longer able to accept Small Claims letter appeals. 

Rather, You are required to file 

a petition 

“Effective 

Ma 

. 2013, 

ais 

nol 

£0 

Solas 

| 

initiate a new Small Claims appeal. 

Petition forms are available on this website, 

http:/Awavw.m ichigan.gov/taxtrib/0,4677,7-187-38254-—-,00.htmi 

RECEIVED MAR 25 2025

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MTT Docket No. 25-003108 

October 21, 2026 

P3-001

MTT Docket No. 25-003108 

October 21, 2026 

i 

P3-001 

ry 

re A 

THIS 

IS NOT A TAX BILL 

L-4400 

Notice of Assessment, Taxable Valuation, and Property Classification 

Baan 

This form is issued under the authority of P.A. 206 of 1893, Sec. 211.24 (c) and Sec.211.34c, as amended. This is a model assessment notice to bo used by the local assessor. 

FROM: HOLLAND CHARTER TOWNSHIP 

PARCEL IDENTIFICATION 

! 

PARCEL NUMBER: 

70-16-04-200-004 

353 N 120TH AVE 

HOLLAND, MI 49424 

5 

PROPERTY ADDRESS: 

12120 NEW HOLLAND ST 

HOLLAND, MI 49424 

PRINCIPAL RESIDENCE EXEMPTION 

OWNER'S NAME & ADDRESS/PERSON NAMED ON ASSESSMENT ROLL: 

. 

% Exempt 

As "Homeowners Principal Residence”: 

00% 

% Exempt 

As "Qualified Agricultural Property”: 

100.00% 

J 

& 

S FARMS LLC 

% Exempt 

As "MBT Industrial Personal”: 

00% 

12120 

NEW HOLLAND 

ST 

0) 

HOLLAND MI 49424 

% Exempt 

As "MBT Commercial Personal”: 

00% 

Exempt 

As "Qualified Forest Property”: 

~~ [] Yes 

[X] No 

S 

Exempt 

As "Development Property”: 

[J Yes 

No 

LEGAL DESCRIPTION: 

| 

PART OF THE NE FRL 1/4 COM AT THE N 1/4 COR, TH S 88D 37M 32S E 1508.84 FT. ALG N SEC LI. TO PT OF BEG, TH CONT SS _ 

88D 37M 32S E 370.25 FT, TH S 0D 29M 11S W.660.08 FT ALG W LI OF E 45 RDS OF NE 1/4 OF NE FRL 1/4, TH N 88D 37M 32S w 

369.52 FT ALG S LI OF N 660 FT OF NE 1/4 OF NE FRL 1/4, TH N 0D 25M 22S E 660.09 FT TO BEG. SEC 4 T5N R15W 5.6 AC 

ACCORDING TO MCL 211.34c THIS PROPERTY IS CLASSIFIED AS: 

401 

Residential 

PRIOR YEAR'S CLASSIFICATION: 

401 

Residential 

The change in taxable value will increase/decrease your tax bill for the 2025 

PRIOR AMOUNT 

CURRENT 

CHANGE FROM 

TENTATIVE AMOUNT 

PRIOR YEAR TO 

yeanbylappioximately; 

$3650 

YEAR: 

2024 

YEAR: 

2025 

CURRENT YEAR 

1. TAXABLE VALUE: 

128,522 

242,900 | 89 945, 

114,378 

7 

| 

2. ASSESSED VALUE: 

E 

214,400 

242,900 | 73.253 2 

28,500 

There 

5 

5 

Eo 

1 

3. TENTATIVE EQUALIZATION FACTOR: 

1.000 

AE 

4. STATE EQUALIZED VALUE (SEV): 

; 

214,400 

242,900 

28,500 

5. There WAS or WAS NOT a transfer of ownership on this property in2024 

WAS 

¥2= 48S 8s0 rd 

6. Assessor Change Reason: 

Market Adjustment 

The 2025 Inflation rate Multiplier is: 1.031 

Questions regarding the Notice of Assessment, Taxable Valuation, and Property Classification may be directed to the Following: 

Name: 

Phone: 

Email Address: 

TYLER WOLFE 

616-395-0236 

TYLERW@HCT.HOLLAND.MI.US 

March Board of Review Appeal Information. The board of review will meet at the following dates and times: 

2025 MARCH BOARD OF REVIEW WILL MEET ON MON. MARCH 10TH, 2025 FROM 9AM-12PM AND 1PM-4PM; WED. MARCH 

“12TH, 2025 FROM 2PM-5PM AND 6PM-9PM. 

PLEASE CALL (616)395-0236 OR E-MAIL TYLERW@HCT. HOLLAND.MLUS TO 

MAKE AN APPOINTMENT OR WITH ANY QUESTIONS. 

*APPEALS IN WRITING, WILL BE ACCEPTED UNTIL MARCH 11TH, 2025 - POSTMARK NOT, ACCEPTED. 

PLEASE PROVIDE SUPPORTING DOCUMENTATION OF YOUR APPEAL TO OUR MARCH BOARD OF REVIEW. 

Gt 

pV 

RECEIVED FEB 2510

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MTT Docket No. 25-003108

October 21, 2026

P4-001

STATE OF MICHIGAN

DEPARTMENT OF LICENSING & REGULATORY AFFAIRS

MICHIGAN ADMINISTRATIVE HEARING SYSTEM

MICHIGAN TAX TRIBUNAL

SMALL CLAIMS DIVISION

J &

SFARMS LLC,

MOAHR Docket No. 25-003108

Petitioner,

Parcel Nos. 70-16-04-200-004

HOLLAND CHARTER TOWNSHIP,

Respondent.

Thomas K. Dillon (P81136)

Bradley J. Fisher

FOSTER SWIFT COLLINS & SMITH, P.C.

SCHOLTEN FANT

Attorneys for Petitioner

Attorneys for Respondent

1700 East Beltline Avenue NE, Suite 200

100 N. Third Street

Grand Rapids, MI 49525

Grand Haven, MI 49417

(616) 726-2258

(616) 842-3030

tdillon@fosterswift.com

bfisher@scholtenfant.com

AFFIDAVIT OF MARY J. NIENHUIS

Mary J. Nienhuis, being duly sworn, states as follows:

1 have personal knowledge of, and am competent to testify to, the matters stated in

this Affidavit.

I am the Trustee of The Larry Allen Nienhuis Living Trust, under agreement dated

April 29, 2002, and The Mary Jane Nienhuis Living Trust, under agreement dated April 29, 2002

(collectively referred to as “the Trusts”).

Prior to August of 2024, the Trusts owned real property located at 12120 New

Holland Street, in Holland Charter Township, identified as property parcel property number 70-

16-04-200-004 (the “Property”). The Property consists of approximately 5.6 acres.

The Property is comprised primarily of farmland, along with a farmhouse and a

pole barn.

Page 21

MTT Docket No. 25-003108 

October 21, 2026 

P4-002

MTT Docket No. 25-003108 

October 21, 2026 

P4-002 

5. 

I have owned and occupied the Property for many years, including all years from 

2000 through August of 2024. 

6. 

During my ownership, and in each year from 2000 through 2024, more than 50% 

of the acreage of the Property was devoted to farming and other agricultural purposes including, 

for example, the farming of cash crops such as soybeans and hay. 

7. 

In August of 2024, I sold the Property to J & S Farms LLC. 

8. 

During my ownership, the Property was classified as residential and was receiving 

the Principal Residence Exemption. 

I was unaware of any distinction between the Principal 

Residence Exemption and the Qualified Agricultural Exemption. 

Further affiant sayeth not. 

my Urls 

Mary JxNienht 

This Affidavit was signed and sworn before me, a notary public, by Mary Nienhuis, on September 

79572026. 

Tan) Gide 

Notary Réblie 

T oy V. Trew 

TRANG V TRIEU 

NOTARY PUBLIC - STATE OF MICHIGAN 

COUNTY OF OTTAWA 

| 

My Commission Expires September 23, 2029 

| Acting in the County of 

Wi 

27415:00006:203063015-1

Page 22

P-5

Page 23

MTT Docket No. 25-003108

October 21, 2026

P5-001

MTT Docket No. 25-003108

October 21, 2026

P5-001

oo.

ERECORDING

2024-0023573

FILED & SEALED FOR RECORD IN

OTTAWA COUNTY, MI

JUSTIN F. ROEBUCK

COUNTY CLERK/REGISTER OF DEEDS

09/12/2024 AT 12:10 PM

30.00

Wickigan Department of Treasury

Sen

Deemer

mus mc

Affidavit Attesting Qualified Agricultural Property Shall Remain Qualified Agricultural Property

1. Street Address

of Proporty

2. Namo

of County

12120 New Holland

Ottawa

3. ClyiownshipViiage Whero Real Estato (a Locatod

Holland

Octy

X Township

0 Village

4. Name of Property Owner(s) (Print or Typo Logibly)

5. Property ID Number (fom Tax BA or Assessment NoEce)

J&SFamsL.L.C.

PPOT0-18.04-200.004

6. Logal Boscripton (Loge) description Is foquired; attach additonal sheets I

7. Porcantago of tis property tial 15, 6nd whl romaln Quaiied Agcultural Properly |

necessary)

(Do Not Include Quatified Forest Program Property)

Attached

100%

8. Daytime Telephone Number

8. E-mail Address

‘Partial transtor under MCL 211.272(B)K)7

80 Pago 2

(616) 218-1455

greatlakesturkey@att.net

Yes

CERTIFICATION & NOTARIZATION (Notarizatlon necessary for recording with Register of Deeds)

| certify that the Information above is true and complete

to the best of my knowladge. {further certify that the property noted

on this affidavit

currently

Is, and will remain, qualified agricultural

property. Must ba signed

Ry: pariner, corparate officer, or a duly authorized agar.

Dated:

727,

,2024

Signed

__"_¥

rdoLy

Name (Prirfald

Title Manager

Dated:

,20,

Signed

Name (Printed

or Type)

Title

STATE

OF MICHIGAN

)

)ss.

COUNTY OF

Ottawa

)

On this _2 £¥* day

fusuc

,20.24 _, the above-named person(s) John W. Janssen, Manager

——

each personally appeared before me. Each acknowledged that the persons’ execution of this affidavit was that

person's free act and deed and affirmed that the contents of this affidavit are true to the best of that person's Information, knowledge

and belief,

PRINTITYPE NAME: Mare {0.0035

NOTARY PUBLIC,

Leu

County, Michigan

Aclingin

ose

County

(NOTARY SEAL)

My commission expires:

___2-2- 28

Drafters Name_ JPW. Joanscen

DrafersAddress_

12)

Ste aloh Read,

Hollgnd

d7dzy

FOR LOCAL GOVERNMENT USE ONLY-AFTER

THE INSTRUMENT: IS'RECORDED

WITH THE

OF DEEDS

eee oie

Shoe

ber 7 Ts Coren poveantogs of te property that’s Guaiied

CJ ves [Ine

Agricultural Property?

If NO, what Is the comect percentage of the property that Is currently Qualified Agricultura! Property?

Asssssor’s Signature

Date

OCROD

PG 1 0F 2

Page 24

MTT Docket No. 25-003108 

October 21, 2026 

P5-002

MTT Docket No. 25-003108 

October 21, 2026 

P5-002 

Michigan Department of Treasury 

“This form ls 

Issued undar 

authority of P.A. 260 

of 

3676 (Rov. 12-18) 

2000 and PA. 378 of 2006, Fng Is mandatory. 

Affidavit Attesting Qualified Agricultural Property Shall Remain Qualified Agricultural Property 

1. Streel Address of Property 

2. Name of County 

12120 New Holland 

Ottawa 

3. CityTownship/Viilage Where Real Eslala is Located 

Holland 

O City 

Township 

0 Village 

4. Name of Property Owner(s) (Print or Type Legibly) 

5. Property ID Number (from Tax Bill or Assessment Notice) 

J&S Farms L.L.C. 

PP#70-16-04-200004 

6. Legal Description (Legal description Is required; attach additional sheets if 

7. Percentage of this property that Is, and will remain Qualified Agricultural Property 

necessary) 

: 

(Do Not Include Qualified Forest Program Property) 

Attached 

100% 

8. Daytime Telephone Number 

9. E-mail Address 

Partial transfer under MCL 211.27a(6)(K)? See Page 2 

(616) 218-1455 

greatlakesturkey@att.net 

[] Yes 

No 

CERTIFICATION & NOTARIZATION (Notarization necessary for recording with Register of Deeds) 

| certify that the information above is true and complete to the best of my knowledge. 

| further certify that the property noted on this affidavit 

currently is, and will remain, qualified agricultural property. Must be signed 

by 

r, partner, corporate officer, or a duly authorized agent. 

Dated: 

9/28 

,2024 

Sars 

ed) V/ 

MAL 

/ 

Name (Prine 

or Type) Job W. Janssen 

Tite Manager 

Dated: 

, 20 

Signed 

Name (Printed or Type) 

Title 

STATE OF MICHIGAN 

 ) 

)ss. 

COUNTY OF 

Ottawa 

) 

On this 

__2 £4 day of Bogue 

20.24, the above-named person(s) John W. Janssen, Manager 

Leach personally appeared before me. Each acknowledged that the persons’ execution of this affidavit was that 

person's free act and deed and affirmed that the contents of this affidavit are true to the best of that person's information, knowledge 

and belief. 

PRINTITYPE NAME: _ Mavi 

[2 wis 

NOTARY PUBLIC, 

feat _ County, Michigan 

Acting in 

OHtre ce 

_County 

(NOTARY SEAL) 

My commission expires: 

2-2- 28 

Drafter's Name __-J &hn 

Aw 

Jean Sgr 

__ 

Drafters Address 

12] 

ote 

alth 

Wewd, 

Hilpad 

ME 

Yqdzy 

FOR LOCAL GOVERNMENT USE ONLY AFTER THE INSTRUMENT IS RECORDED WITH THE REGISTER OF DEEDS 

Is the percentage stated above in number 7 the current percentage of the property that is Qualified 

0 Yes 0 No 

Agricultural Property? 

If NO, what is the correct percentage of the property that is currently Qualified Agricultural Property? 

Assessor's Signature 

Date

Page 25

MTT Docket No. 25-003108 

October 21, 2026 

P5-003

MTT Docket No. 25-003108 

October 21, 2026 

P5-003 

EXHIBIT “A” LEGAL DESCRIPTION 

For APN/Parcel ID(s): 70-16-04-200-004 

Land Situated In the State of Michigan, County of Ottawa, Township of Holland. 

Part of the Northeast Fractional 1/4 of Section 4, Town § North, Range 15 West, Holland Township, 

Ottawa County, Michigan, described as: 

Commencing at the North 1/4 comer of said Section; thence S88°37'32°E 1508.84 feet along the North 

line of said section to the Paint of Beginning; thence continuing along said North line S88°37'32"E 

370.25 feet; thence S00°29'11"W 660.08 feet along the West line of the East 45 Rods of the NE 1/4 of 

the NE fractional 1/4 of said section; thence N88°37°32"W 369.52 feet along the South line of the North 

660 feet of the NE 1/4 of the NE fractional 1/4 of said section; thence N00°25'22"E 660.09 feet parallel 

with the West line of the NE 1/4 of the NE fractional 1/4 of said section to the Point of Beginning.

Page 26

P-6

Page 27

Phelps v. Courtland Twp., 2017 WL 2634774 (2017)

2017 WL 2634774 (Mich. Tax Tribunal)

Michigan Tax Tribunal

Department of Energy, Labor and Economic Growth

State of Michigan

AARON M PHELPS, PETITIONER

COURTLAND TOWNSHIP, RESPONDENT

MTT Docket No. 16-002057

May 2, 2017

ORDER DENYING RESPONDENT'S MOTION FOR SUMMARY DISPOSITION ORDER GRANTING

PETITIONER'S MOTION FOR SUMMARY DISPOSITION FINAL OPINION AND JUDGMENT

*1 The Tribunal issued a proposed order denying Respondent's motion for summary disposition and granting Petitioner's

motion for summary disposition (“POJ”) on March 27, 2017. The POJ states, in pertinent part, “[t]he parties have 20 days from

date of entry of this POJ to notify the Tribunal in writing, by mail or by electronic filing, if available, if they do not agree

with the POJ and to state in writing why they do not agree with the POJ (i.e., exceptions).”

Neither party has filed exceptions to the POJ.

The Administrative Law Judge (“ALJ”) considered the testimony and evidence and made specific findings of fact and

conclusions of law. The ALJ's determination is supported by the testimony and evidence and applicable statutory and case law.

Given the above, the Tribunal adopts the POJ as the Tribunal's final decision in this case. 1 The Tribunal also incorporates by

reference the Findings of Fact and Conclusions of Law contained in the POJ in this Final Opinion and Judgment. As a result:

The property's TV, as established by the Board of Review for the tax year at issue, is:

Parcel Number: 41-07-09-400-001

Year

2016

$60,326

The property's final TV for the tax year at issue, as determined by the Tribunal, is:

Parcel Number: 41-07-09-400-001

Year

2016

$35,824

IT IS SO ORDERED.

MTT Docket No. 25-003108

October 21, 2026

P6-001

Page 28

Phelps v. Courtland Twp., 2017 WL 2634774 (2017)

IT IS FURTHER ORDERED that Respondent's Motion for Summary Disposition is DENIED.

IT IS FURTHER ORDERED that Petitioner's Motion for Summary Disposition is GRANTED.

IT IS FURTHER ORDERED that Petitioner is NOT entitled to a refund of the property's ad valorem taxes paid for the 2016

tax year.

IT IS FURTHER ORDERED that the officer charged with maintaining the assessment rolls for the tax year at issue shall correct

or cause the assessment rolls to be corrected to reflect the property's qualified agricultural exemption as provided in this Final

Opinion and Judgment within 20 days of entry of this Final Opinion and Judgment.

This Final Opinion and Judgment resolves the last pending claim and closes this case.

APPEAL RIGHTS

If you disagree with the final decision in this case, you may file a motion for reconsideration with the Tribunal or a claim of

appeal with the Michigan Court of Appeals.

A Motion for reconsideration must be filed with the required filing fee within 21 days from the date of entry of the final

decision. 2 Because the final decision closes the case, the motion cannot be filed through the Tribunal's web-based e-filing

system; it must be filed by mail or personal service. The fee for the filing of such motions is $50.00 in the Entire Tribunal and

$25.00 in the Small Claims Division, unless the Small Claims decision relates to the valuation of property and the property had

a principal residence exemption of at least 50% at the time the petition was filed or the decision relates to the grant or denial

of a poverty exemption and, if so, there is no filing fee. 3 A copy of the motion must be served on the opposing party by mail

or personal service or by email if the opposing party agrees to electronic service, and proof demonstrating that service must be

submitted with the motion. 4 Responses to motions for reconsideration are prohibited and there are no oral arguments unless

otherwise ordered by the Tribunal. 5

*2 A claim of appeal must be filed with the appropriate filing fee. If the claim is filed within 21 days of the entry of the

final decision, it is an ““appeal by right.” If the claim is filed more than 21 days after the entry of the final decision, it is an

“appeal by leave.” 6 A copy of the claim must be filed with the Tribunal with the filing fee required for certification of the

record on appeal. 7 The fee for certification is $100.00 in both the Entire Tribunal and the Small Claims Division, unless no

Small Claims fee is required. 8

Steven H. Lasher

Tribunal Judge Presiding

ORDER GRANTING MICHIGAN FARM BUREAU'S MOTION FOR LEAVE TO FILE AMICUS CURIAE BRIEF

PROPOSED ORDER DENYING RESPONDENT'S MOTION FOR SUMMARY DISPOSITION

PROPOSED ORDER GRANTING PETITIONER'S MOTION FOR SUMMARY DISPOSITION

MTT Docket No. 25-003108

October 21, 2026

P6-002

Page 29

Phelps v. Courtland Twp., 2017 WL 2634774 (2017)

On January 18, 2017, Respondent filed a Motion requesting that the Tribunal render summary disposition in its favor pursuant

to MCL 2.116(C)(10), as “there is no disputed issue fact and the Township is entitled to judgment as a matter of law.” In the

Motion, Respondent contends that:

1. “This case involves the ‘resetting’ [i.e., recapping] provisions of MCL 211.27a(8) for qualified agricultural property. The

statute imposes the following requirement for ‘resetting’: ‘The qualified agricultural property was qualified agricultural property

for taxes levied in 1999 and each year after 1999.’ [Emphasis in the original.] The prior property owners had never claimed

the qualified agricultural property exemption Rom 18 mill local school operating millage afforded by MCL 211.7eeprior to

2011. Nevertheless, Petitioner claims that the taxable value of the property should be ‘reset’ if the property had been used

in a manner that would have satisfied the definition of ‘qualified agricultural property’ for 1999 and every year since 1999,

regardless of whether the prior property owners had actually claimed the qualified agricultural exemption.” [Emphasis added.]

2. “The issue presented by this motion is a purely legal question: To qualify for ‘resetting’ under qualifying agricultural property,

must all previous property owners have actually claimed the qualified agricultural exemption from local school operating taxes

for 1999 and each year thereafter? If so, judgment must be entered in favor of the Township. If not, then this Tribunal must

conduct an evidentiary hearing to determine whether the property was actually being used in such a manner that it would have

qualified for each and every year between 1999 and 2010.”

3. “Since 1999, the property has had four owners, including Mr. and Mrs. Phelps.”

4. “The taxable value was ‘uncapped’ by virtue of the 2002 transfer to Kleinheksel. No uncapping occurred by virtue of the

2008 transfer from Kleinheksel to MBK Holding, LLC, because that entity claimed the exemption for transfers between entities

under common control or members of an affiliated group .... Had the 2002 uncapping event not occurred, the 2016 taxable

value would have been $35,824, which is what Mr. Phelps claims it should be ... [[Emphasis added.]

5. “With respect to exemption from the local school operating millage, the property was subject to a principal residence

exemption from 1999 through 2003. Neither a PRE nor a qualified agricultural exemption was claimed from 2003

through 2010. For the first time, MBK Holdings claimed a 100% qualified agricultural property exemption in 2011.”

[Emphasis added.]

6. “Petitioner Aaron Phelps and his wife, Elizabeth Phelps, purchased the subject property on or about March 11, 2016 .... The

Phelps executed and recorded an ‘Affidavit Attesting that Qualified Agricultural Property Shall Remain Qualified Agricultural

Property,’ Treasury Form 3676, on or about March 16, 2016 .... It is the Township's intention to accept that affidavit, such that

the 2016 taxable value of $60,326 will not become uncapped by virtue of the sale from MBK Holdings, LLC to the Phelps, and

the 2017 taxable value will increase only by the lesser of the increase in the general price level or 5% ....

7. “By letter dated March 29, 2016 ... Mr. Phelps asserted that the 2017 taxable value should be calculated as if there had been

no transfer of ownership since 1999. Following consultation with the Township attorney and the State Tax Commission, it

was determined that MCL 211.27a(8) requires that the property had actually been receiving a qualified agricultural exemption

for 1999 and every year since 1999, Accordingly, the assessor informed Mr. Phelps on May 4, 2016, that although the 2017

taxable value would not be uncapped by virtue of the 2016 transfer, the 2017 taxable value would not be reset pursuant to MCL

211.27a(8). Mr. Phelps fried this appeal within 35 days of that notification.”

8. “Courtland Township's position is that the resetting provisions of MCL 211.27a(8) are available only if the subject property

had actually been receiving the qualified agricultural exemption from local school operating taxes for 1999 and for each year

thereafter. [Emphasis in the original.] It is not sufficient that the property could have met the definition of qualified agricultural

property and may have been eligible for such an exemption. [[Emphasis in the original.] The only potential factual issue

with respect to that legal question is whether the subject property was or was not receiving the qualified agricultural property

exemption from local school operating taxes for each of the years from and including 1999. Whether the property was used in

such a manner that it could have qualified for such an exemption is irrelevant for purposes of this motion.”

MTT Docket No. 25-003108

October 21, 2026

P6-003

Page 30

Phelps v. Courtland Twp., 2017 WL 2634774 (2017)

9. “That the property at issue had never received the qualified agricultural exemption from the local school operating millage

prior to 2011 is supported by the assessor's affidavit ... and we doubt that there will be any opposition to that. Therefore,

the Township will have satisfied its burden of providing documentary evidence that there is no disputed issue of fact, and the

Township is entitled to summary disposition as a matter of law.” [Emphasis added.]

10. “Act 260 was initiated by Senate Bill 709. Substitute Senate Bill 709, passed by the Senate on October 12, 1999, included

an exemption from uncapping for transfers of qualified agricultural property, with language similar to that ultimately adopted,

but did not include the provision for resetting taxable value. The resetting provisions of subsections (8) and (9) were added by

a substitute House version of Senate Bill 709 reflecting the recommendation by the House Committee on Agriculture Resource

Management, passed by the House on June 7, 2000, and concurred by the Senate on June 8, 2000. The Legislative Analysis of

the House substitute reflects a deliberate inclusion of the language ‘for taxes levied’ as one of the requirements for resetting ....

[Emphasis added.] 1

11. “Claiming the exemption for qualified agricultural property ‘for taxes levied’ requires either that the property be classified

as agricultural for equalization purposes, or that the owner file an affidavit claiming the exemption.” 2 [Emphasis added,]

12. “Here it is undisputed that this property was classified as either residential vacant or residential improved every year from

1999 through 2016.” [[Emphasis added.]

13. “If the property is not classified as agricultural, the property owners must file an affidavit claiming the exemption (Treasury

Form 2599) and the owners of this property never did so until the 2011 tax year.” [Emphasis added.]

14. “For purposes of the exemption, ‘qualified agricultural property’ is defined by MCL 211.7dd(d). The determination of

whether property meets this definition depends on the nature of agricultural use, and the extent of property put to that use. For

purposes of this motion, however, it is irrelevant whether the Phelps parcel met the definition of ‘qualified agricultural property’

because it was not receiving the exemption from local school operating taxes prior to 2011.”

15. “Applying this principle here: The phrase ‘for taxes levied’ has no meaning unless it means that the property was actually

receiving the qualified agricultural exemption from local school operating taxes. 3 The construction urged by Mr. Phelps would

rewrite this requirement to read: ‘The qualified agricultural property was qualified agricultural property in 1999 and each year

after 1999,’ thus ignoring and rendering the phrase ‘for taxes levied’ meaningless and surplusage.” [Emphasis added.]

16. “The phraseology of MCL 211.27a(o) does not require that qualified agricultural property be receiving the qualified

agricultural exemption ‘for taxes levied’ in the year of the transfer, or for any particular time, in order to take advantage of

the exemption from uncapping for the year following transfer of such property. In contrast, the provisions for resetting do

specifically require that the property was qualified agricultural property ‘for taxes levied’ in 1999 and each year thereafter. 4

[Emphasis in the original,] This difference reflects a deliberate decision by the legislature that it was not necessary that property

be receiving the qualified agricultural exemption ‘for taxes levied’ in order to claim the uncapping exemption, but that it was

necessary that the property be receiving the exemption to qualify for resetting of the taxable value.”

17. “The uncapping and resetting provisions for agricultural property were drafted in recognition of the need for practical and

effective administration of the law, as well illustrated by this case. The determination of whether property meets the definition of

‘qualified agricultural property’ is a fact based determination requiring first an analysis of whether at least 50% of the property is

devoted to any of the various ‘agricultural uses' defined in MCL 324.36101(b). In addition, property, or portions of the property,

used for commercial storage, processing, distribution, marketing, shipping or other commercial or industrial purposes do not

qualify, so that needs to be determined. Moreover, in the case of a property which includes a residence, a determination must be

made whether that residence is ‘occupied by a person employed in or actively involved in the agricultural use ....’ MCL211.7dd.”

MTT Docket No. 25-003108

October 21, 2026

P6-004

Page 31

Phelps v. Courtland Twp., 2017 WL 2634774 (2017)

18. “If Mr. Phelps' position is correct, and satisfying the definition of “qualified agricultural property' is sufficient regardless

of whether the exemption is granted, the local assessor and this Tribunal are faced with the daunting task of taking evidence

to determine whether a property met the definition of qualified agricultural property 18 years ago, in 1999. If so, did it meet it

again in 2000? If so, did it meet it in 2001? And so on for each and every year thereafter ....”

19. “To address this, the Legislature required that the property had actually received the qualified agricultural property exemption

for property taxes for 1999 and each year thereafter. This can be easily verified from the historical assessment records. This

requirement dovetails with provisions of the General Property Tax Act which allow for challenging the classification of property

for equalization purposes (MCL 211.3 4c( 16)), and for testing whether or not the property is truly qualified agricultural property

(MCL 211.7ee(4)-(8)) on an annual basis when the facts are more easily determined, not 18 or more years later.”

20. “In contrast, the requirement that the property had been receiving the qualified property tax exemption in the year of transfer

is not included in the uncapping exemption in MCL 211.27a(7)(o) because the assessor need only to evaluate the use of the

property during, at most, the prior 12 months. Thus, a record of receiving the exemption is not nearly so important”

21. “The legislative design acknowledges the incentive for property owners to claim the qualified agricultural property tax

exemption, if it is available to them. A property owner might deliberately choose not to take advantage of the uncapping

provisions of MCL 211.27a(7)(o) if unsure of the future use of the property and desiring to avoid the agricultural property

recapture tax. However, there is no ‘claw back’ of the local school operating millage if the status of a qualified agricultural

property for exemption purposes changes from year to year, and so there is no disincentive to claiming the qualified agricultural

property tax exemption.”

22. “The [Red Arrow Diary] 5 decision does not indicate whether the properties had achieved ... [the qualified agricultural

property] status by virtue of classification as agricultural property or the filing of an exemption affidavit. Rather, it was simply

accepted as true that the property was qualified agricultural property ‘for taxes levied in 1999 and for each year after 1999.” 6

23. “Bulletins issued by the State Tax Commission also do not directly address the issue of whether a subject property must

have been receiving the qualified agricultural exemption from local school operating taxes in order to be eligible for resetting,

and only considered that question in the context of uncapping pursuant to MCL 211.27a(7)(o). See Bulletin No. 7 of 2006,

Transfers of Qualified Agricultural Property (August 29, 2006). However, the position taken by Courtland Township here is

consistent with staff advice from Timothy Schnelle of the State Tax Commission dated May 3, 2016, and attached to petitioner's

own [petition] 7 .... Mr. Schnelle pointed out that the Red Arrow Dairy case involved a situation in which the property had

admittedly been receiving a qualified agricultural exemption since 1999, unlike the Phelps situation. In addition, he set forth the

department's position that ‘we interpret the statute as requiring actual qualified ag designation since 1999 ....’ With respect to

this, Mr. Schnelle further noted: ‘How can one determine the amount of tilled acreage and the relative values of the residential

and agricultural uses going back 18 years?”’

24. “Mr. Phelps cannot be heard now to complain that the property should have been included in one of the agricultural

classifications in previous years. Each year, a property owner has the opportunity to dispute the classification of a parcel, with a

right to appeal to the State Tax Commission, MCL 211.34c(6). In addition, a property owner may claim the qualified agricultural

exemption by filing the required affidavit claiming the exemption, without seeking to change the classification. In 1999 through

2002, the Squires were claiming a principal residence ... exemption for this property, so perhaps they did not see any necessity

for challenging their classification or claiming exemption as a qualified agricultural property. But it is inexplicable why the

Kleinheksels and their related company, MBK Holdings, never sought to claim the qualified agricultural exemption from 2003

through 2010 if they were entitled to it.”

25. “Mr. Phelps also may not [be] heard to complain that the outcome here is unfair, or that the Tribunal should exercise powers

of equity to ‘treat as done that which should have been done.’ This Tribunal and the Michigan Appellate Courts have made

MTT Docket No. 25-003108

October 21, 2026

P6-005

Page 32

Phelps v. Courtland Twp., 2017 WL 2634774 (2017)

[it] absolutely clear that the Tribunal does not have powers of equity. See Electronic Data Systems Corp v Flint Township, 253

Mich App 538, 548[; 656 NW2d 215] (2002)....”

On February 8, 2017, Petitioner filed a Response to Respondent's Motion and a Cross-Motion for Summary Disposition pursuant

to MCR 2.116(C)(10). In the Response and the Cross- Motion, Petitioner contends that:

1. “This case concerns 60 contiguous acres of farmland .... [that] has continuously been ‘qualified agricultural property.’ In 2002,

the owner of the Farm (who had owned it for over twenty-three years) sold it. Although the 2002 purchaser continued to farm the

property as it had been farmed before, he never filed the Form 3676 Affidavit, resulting in the uncapping of the taxable value.”

2. “In 2016, Petitioner purchased the Farm and promptly filed Form 3676, attesting that the Farm shall remain qualified

agricultural property. Petitioner also requested that the Courtland Township Assessor revise the taxable value of the Farm to the

value it would have had [had] no transfer occurred in [2003], pursuant to MCL 211.27a(8).”

3. “Petitioner has strictly complied with the recapping requirements established by MCL 211.27a(8): the Farm has and continues

to meet the statutory definition of qualified agricultural property, and Petitioner has filed an affidavit attesting to continue using

the Farm for qualified agricultural purposes. Therefore, Petitioner, not Respondent, is entitled to summary disposition and the

Farm's taxable value should be re-capped.”

4. “The statute does not mention, much less require, exemption from local school operating taxes (a matter wholly unrelated

to taxable value) in order to re-cap. Rather, the statute requires only that the property be ‘qualified agricultural property/ that is

[sic] property ‘devoted primarily to agricultural use.’ The Farm is, and has been, ‘qualified agricultural property.”' 8

5. “The law ... provides that a transfer of qualified agricultural property does not constitute a “transfer of ownership' if the

transferee files an affidavit with the local tax assessor and the register of deeds, attesting that the qualified agricultural property

will remain qualified agricultural property. MCL 211.27a(o) .... However, for a variety of reasons (including simple ignorance),

property owners do not always file Form 3676, resulting in the uncapping of taxable values. The Legislature addressed this

situation in MCL 211.27a(8) by requiring assessors to ‘revise’ the current year's taxable value to the value of the property ‘would

have had if there had been no transfer of ownership ... since December 31, 1999 ....’ MCL 211.27a(8). The only requirements

for recapping a property's taxable value are that the property (1) has been ‘qualified agricultural property’ without interruption

since 1999, and (2) that the owner files an affidavit with the local assessor pursuant to MCL 211.27a(o).”

6. “Allowing the current owner to adjust the property's taxable value through this process facilitates the statute's purpose of

easing tax burdens on farmers, thereby promoting the continued use of land for agricultural purposes. 2000 Leg. Analysis.

Without such a provision, farmers in Petitioner's position, who have acquired agricultural land and intend to continue to use the

land for agricultural purposes, would be stuck paying taxes on an inflated taxable value relative to other farmland.”

7. “Petitioner has submitted his own affidavit, as well as affidavits from the Farm's prior owner (and deceased owner's daughter)

attesting to ... [the] fact [[of the property's agricultural use]. See Exhibits A-C. The Township has no contrary evidence.

Therefore, the fact that the Farm is (and has been) “qualified agricultural property' is undisputed.”

8. “MCL 211,27a(8) makes no mention of 211.7ee at all, much less incorporates by reference its exemption procedure, and the

Township has no authority to impose additional requirements not authorized by the Legislature.” 9

9. “The statute is clear; all that is required is that the property be “qualified agricultural property.' The Legislature defined

qualified agricultural property as property devoted primarily to agricultural use. [[Emphasis in the original.] The key word

is ‘devoted.’ It only matters how the property has been used, not whether an exemption from school taxes was granted by the

Township. [Emphasis in the original.] The Township's position re-writes the law. Not only would a Form 2599 exemption have

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to be requested since 1999, but the Township would have to approve it. No such obstacle was interposed by the Legislation

and none can now be demanded by the Township.” 10

10. ... the 2016 taxable value should have been $35,824, which in turn should have reduced the 2016 summer tax bill, which

was unpaid when the recapping was requested. Consequently, Petitioner is now owed a partial refund for summer and winter

2016 taxes.”

On February 17, 2017, Respondent filed a Response to Petitioner's Motion, In the Response, Respondent contends that:

1. “Petitioner did not contest that the property had not been receiving the qualified agricultural exemption from property taxes

for 1999 and each year thereafter. Rather, Petitioner takes the position that such exemption is not a prerequisite to resetting.”

2. “Considering the difficulty, expense, and burden on staff, the Township does not intend to contest the Affidavits filed by

Petitioner. Indeed, such burden on the taxing unit is the reason why the resetting statute requires confirmation of agricultural

use by reference to the easily verifiable fact of whether the property had been receiving the qualified agricultural exemption

for 1999 and each year thereafter.”

3. “The Township's position is that the actual use of the property is irrelevant, and that the Petitioner is not eligible for resetting

unless the property had been receiving the qualified agricultural exemption from local school operating taxes for 1999 and every

single year thereafter. Indisputably it was not.”

On February 27, 2017, the Michigan Farm Bureau (“Farm Bureau”) filed a Motion requesting that the Tribunal permit it to

file an Amicus Curiae brief in support of Petitioner. In the Motion, the Farm Bureau contends that “... [the] Farm Bureau has

determined that resolution of the legal issue in this case will significantly impact the owners of farmland throughout the state”

and “... [the] Amicus Brief ... offers additional analysis and different perspectives on the legal issue and that the Brief will aid

the Tribunal in reviewing the pending motions.”

The Tribunal has reviewed the Motions, the Responses, and the case file and finds the resolution of the legal issue may, in

fact, “significantly impact the owners of farmland throughout the state” and that the amicus brief, although unnecessary, does

provide some marginal assistance in resolving that issue. 11 As a result, the Farm Bureau has shown good cause to justify the

granting of its Motion.

With respect to the parties' motions, there is no specific Tribunal rule governing motions for summary disposition. Nevertheless,

the Tribunal is bound to follow the Michigan Rules of Court in rendering a decision on such motions. 12 In that regard, a motion

filed under MCR 2.116(C)(10) tests the factual support for Petitioner's claim based upon the Tribunal's consideration of all

pleadings, affidavits, depositions, admissions, and any other documentary evidence submitted by the parties “in the light most

favorable to the party opposing the motion.” 13 Further, the Tribunal may only grant such motions if the parties' submissions

show that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. 14

If it is, however, determined that an asserted claim can be supported by evidence at trial, the motion under (C)(10) must be

denied. 15 The moving party bears the initial burden of supporting its position by presenting its documentary evidence for the

court to consider. The burden then shifts to the opposing party to establish that a genuine issue of disputed fact exists. 16 Where

the burden of proof at trial on a dispositive issue rests on a non-moving party, the non-moving party may not rely on mere

allegations or denials in pleadings but must go beyond the pleadings to set forth specific facts showing that a genuine issue

of material fact exists. 17 If the opposing party fails to present documentary evidence establishing the existence of a material

factual dispute, the motion is properly granted. 18

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8

Here, Respondent contends that the property is not entitled to have its taxable value “reset” because the property had not “actually

been receiving the qualified agricultural exemption from local school operating taxes for 1999 and for each year thereafter.” In

support of its argument, Respondent indicates that the resetting of the taxable value would render the phrase “for taxes levied”

meaningless contrary to principles of statutory construction. 19 More specifically, Respondent is asking the Tribunal to interpret

that phrase so as to limit the “resetting” to properties that have annually received qualified agricultural exemptions only. 20

Although the applicable statutes are not strictly tax exemption statutes, they do provide for an exception to full taxation. As

such, they are sufficiently similar to exemption statutes so as to require that they be “strictly construed in favor of the taxing

authority.” 21 That does not, however, mean that the Tribunal “should give a strained construction which is adverse to the

Legislature's intent.” Nevertheless, the term or, more appropriately, phrase ““for the taxes levied” is not, unfortunately, defined

and, as a result, the Tribunal is required to interpret that phrase to “glean the Legislature's intent.” 22 Any such interpretation

does, however, begin with a review of the plain language of the statutes at issue. 23 In that regard, MCL 211.27a(7) provides,

in pertinent part:

Transfer of ownership does not include the following:

(0) ... a transfer of qualified agricultural property, if the person to whom the qualified agricultural property is transferred files

an affidavit with the assessor of the local tax collecting unit in which the qualified agricultural property is located and with the

register of deeds for the county in which the qualified agricultural property is located attesting that the qualified agricultural

property will remain qualified agricultural property .... If property ceases to be qualified agricultural property at any time after

a transfer subject to this subdivision, all of the following shall occur:

(i) The taxable value of that property ... shall be adjusted under subsection (3) as of the December 31 in the year that the

property ... ceases to be qualified agricultural property ....

[Emphasis added.]

The phrase “for taxes levied” is not contained in this portion of the statutory scheme relating to transfers of qualified agricultural

property (i.e., uncapping) and said omission is considered “intentional.” 24 There is also no requirement that the property have

a qualified agricultural exemption. Rather, the statute merely requires the property to be “qualified agricultural property” and

indicates that said status can “cease” at any time, which is consistent with the requirements for the granting and rescission of

a qualified agricultural exemption. 25

As for the recapping portion, MCL 211,27a(8) provides, in pertinent part:

If all of the following conditions are satisfied, the local tax collecting unit shall revise the taxable value of qualified agricultural

property taxable on the tax roll in the possession of that local tax collecting unit to the taxable value that qualified agricultural

property would have had if there had been no transfer of ownership of that qualified agricultural property since December

31, 1999 and there had been no adjustment of that qualified agricultural property's taxable value under subsection (3) since

December 31, 1999:

(a) The qualified agricultural property was qualified agricultural property for taxes levied in 1999 and each year after 1999.

(b) The owner of the qualified agricultural property files an affidavit with the assessor of the local tax collecting unit under

subsection (7)(o).

[Emphasis added.]

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9

Although the phrase “for tax levied” is contained in this portion of the statutory scheme, the statute does not specifically require

that the property had to have had a qualified agricultural exemption for the 1999 tax year and each year after 1999. Rather, the

plain language of the statute requires the property to have been qualified agricultural property during that time period, which

is consistent with Petitioner's offered interpretation of that phrase. More specifically, the disputed phrase is one that is, in fact,

commonly used in the General Property Tax Act to denote the effective date of particular statutory provisions (i.e., “[f]or taxes

levied after December 31, 2002,” etc.) 26 and the Tribunal has a responsibility to read the contested portion of the statute in

relation to the Act so as to ensure that the statutory provisions “work in mutual agreement.” 27 Additionally, said phraseology

seems to have acquired a particular meaning in the Act and should be construed accordingly. 28

As for Respondent's reliance on the bill analysis prepared by the House Legislative Analysis Section in support of the “deliberate

inclusion” of the phrase, said reliance is misplaced, as the Michigan Court of Appeals has stated that “staff prepared legislative

analysis does not ‘summarize the intentions of those who have been designated by the Constitution to be participants in

this legislative process' and therefore ‘should be accorded very little significance by courts when construing a statute.”' 29

Nevertheless, it is clear that the object of the statute and the harm it was designed to remedy related to the continuation of

farmland with a remedy, albeit punitive in nature, providing for a recapture of taxes should the property no longer be primarily

devoted to agricultural use. 30 In that regard, the amendment adding the language at issue did not become effective until March

28, 2001.

As for the definition of “qualified agricultural property,” MCL 211.27a(11)(t) provides “[q]ualified agricultural property” means

that term as defined in section 7dd” and MCL 211.7dd(d) provides, in pertinent part:

“Qualified agricultural property” means unoccupied property and related buildings classified as agricultural, or other

unoccupied property and related buildings located on that property devoted primarily to agricultural use as defined in

section 36101 of the natural resources and environmental protection act, 1994 PA 451, MCL 324.36101. Related buildings

include a residence occupied by a person employed in or actively involved in the agricultural use and who has not claimed a

principal residence exemption on other property .... Property used for commercial storage, commercial processing, commercial

distribution, commercial marketing, or commercial shipping operations or other commercial or industrial purposes is not

qualified agricultural property. A parcel of property is devoted primarily to agricultural use only if more than 50% of

the parcel's acreage is devoted to agricultural use. An owner shall not receive an exemption for that portion of the total

state equalized valuation of the property that is used for a commercial or industrial purpose or that is a residence that is not

a related building ....

[Emphasis added.] 31

The phrase “for taxes levied” is not in the statutory definition of “qualified agricultural property” and the provision does not

condition the status of property as qualified agricultural property based on the issuance of a qualified agricultural exemption.

Rather, the definition requires the property to either be classified as agricultural property or that the property be primarily

devoted to agricultural use.

Given the above, Respondent's contention that the Legislature included the phrase “for tax levied” as an indication that the

issuance of a qualified agricultural exemption was a prerequisite to recapping is strained at best and “courts may not read into

the statute a requirement that the Legislature has seen fit to omit.” 32 Although Respondent's contention relative to the efficient

administration of the said recapping has some merit, said administration does not justify the imposition of a requirement not

provided by law. 33 Further, any difficulty in said administration is alleviated by the burden that an owner or, more appropriately,

transferee would have in establishing that the property was qualified agricultural property for taxes levied in 1999 and each

year after by a preponderance of evidence, which in this case has been established by the submission of Petitioner's affidavits

and Respondent's failure to contest those affidavits.

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Said determination is consistent with a prior decision rendered by the Tribunal. 34 More specifically, the Tribunal specifically

found in that case that “[p]roof that the subject property is qualified agricultural property and a Form 3676 affidavit attesting to

the property's continued use of qualified agricultural property is all that section 8 requires.” 35 Although Respondent contends

that the Tribunal did not in that case consider the question at issue in this case (i.e., whether the property was required to have been

receiving a qualified agricultural exemption) given that it was undisputed that the property was qualified agricultural property,

said contention is without merit, as the question was specifically addressed as the Tribunal did not find or otherwise hold that

the property was also required to have received a qualified agricultural exemption to be entitled to recapping. Additionally,

Respondent's reliance on statements made by a representative of the Michigan State Tax Commission (“STC”) is also misplaced

because those statements are unsupported and “the tribunal is the final agency for the administration of property tax laws.” 36

“When the Legislature fails to address a concern in the statute with a specific provision, the courts cannot insert a provision

simply because it would have been wise of the Legislature to do so to effect the statute's purpose.” Mich Basic Prop Ins Ass'n,

[supra]... at [p] 560 ....

Finally or, more importantly, the Tribunal finds that there is no genuine issue of material fact with respect to the status of the

property as qualified agricultural property for the 1999 tax year and each after 1999 and that Petitioner is entitled to summary

judgment as a matter of law. More specifically, the submitted documents establish that the property was qualified agricultural

property during that time period and, as a result, was, based on the filing of Petitioner's March 16, 2016 affidavit, entitled to a

recapping or recalculation (i.e., resetting) of the property's taxable value for the 2016 tax year as if there had been no transfer

since 1999 in the amount indicated herein. 37 Petitioner is not, however, entitled to a refund of the taxes paid for the 2016 tax

year, as the property's taxable value is being proposed for “adjustment under subsection (8)” by this decision, which is occurring

after the collection or payment of taxes for that tax year. 38 Therefore,

IT IS ORDERED that the Michigan Farm Bureau's Motion for Leave to File Amicus Curiae Brief is GRANTED.

IT IS FURTHER ORDERED that Respondent's Motion for Summary Disposition is DENIED.

IT IS FURTHER ORDERED that Petitioner's Motion for Summary Disposition is GRANTED.

IT IS FURTHER ORDERED that the property's taxable value (TV) for the tax year at issue is as follows:

Parcel Number: 41-07-09-400-001

Year

2016

$35,824

IT IS FURTHER ORDERED that Petitioner is NOT ENTITLED to a refund of the property's ad valorem taxes paid for the

2016 tax year.

JUDGMENT

This is a proposed decision (“POJ”) prepared by the Michigan Administrative Hearings System. It is not a final decision. As

such, no action should be taken based on this decision. In that regard, the Tribunal will, after the expiration of the time period

for the opposing party to file a response to exceptions, will review the case file, including the POJ and all exceptions and

responses, if any, and: 39

a. Issue a Final Opinion and Judgment (FOJ) adopting the POJ as the final decision.

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b. Issue an FOJ modifying the POJ and adopting the Modified POJ as the final decision.

c. Issue an Order vacating the POJ and ordering a rehearing or such other action as is necessary and appropriate.

EXCEPTIONS

The parties have 20 days from date of entry of this POJ to notify the Tribunal in writing, by mail or by electronic filing, if

available, that they do not agree with the POJ and to state in writing why they do not agree with the POJ (i.e., exceptions).

Exceptions are limited to the evidence submitted with the Motion, the Response, and any matter addressed in the POJ. There

is no fee for filing exceptions and the opposing party has 14 days from the date the exceptions were mailed to or electronically

served on that party (i.e., email), if the parties agree to service by email, to file a written response to the exceptions. 40

Exceptions and responses filed by e-mail or facsimile will not be considered in the rendering of the Final Opinion and Judgment.

A copy of a party's written exceptions or response must be sent to the opposing party by mail or email, if email service is

agreed upon by the parties, and proof must be submitted to the Tribunal demonstrating that the exceptions or response were

served on the opposing party.

Peter M. Kopke

Administrative Law Judge Presiding

March 27, 2017

Footnotes

See MCL 205.726.

See TTR 261 and 257.

See TTR 217 and 267.

See TTR 261 and 225.

See TTR 261 and 257.

See MCL 205.753 and MCR 7.204.

See TTR 213.

See TTR 217 and 267.

See the House Legislative Analysis Section, Addendum to Senate Fiscal Agency Analysis of SB 09 Dated 1-10-00, (May

24, 2000).

See MCL 211.7ee(2) and (4).

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12

3

Respondent cites Aroma Wines & Equipment, Inc v Columbian Distribution Services, Inc, 497 Mich 337, 345-56; 871

NW2d 136 (2015) in support of the ““principle” relied upon. Respondent also cites People v Miller, 498 Mich 886; 869

NW2d 606 (2015), Kincaid v City of Flint, 311 Mich App 76; 874 NW2d 193 (2015), Harbor Watch Condominium Ass

A v Emmet County Treasurer, 308 Mich App 380; 863 NW2d 745 (2014), and Robertson v DaimlerChryselr Corp, 465

Mich 732, 748: 641 NW2d 567 (2002).

4

Respondent cites Tyler v Livonia Public Schools, 220 Mich App 697, 701; 561 NW2d 390, 392 (1996), affd, 459 Mich

382; 590 NW2d 560 (1999) for the proposition that “phraseological distinctions in the subparagraphs of a statutory

section presumably reflect a legislative intent to treat some things differently.” Respondent also cites People v Carruthers,

301 Mich App 590, 604; 837 NW2d 16 (2003) and United States Fidelity and Guarantee Co v Michigan Catastrophic

Claims Ass'n (On Rehearing), 484 Mich 1, 14; 795 NW2d 101 (2009).

5

See the Order granting Petitioner's Motion for Summary Disposition issued by the Tribunal in Red Arrow Daity LLC v

Hartford Twp on November 30,2007 (MTT Docket No. 320205).

6

The parties stipulated that the properties at issue were qualified agricultural property for taxes levied in 1999 and for each

year after 1999. Respondent also indicates that the decision in Lyle Schmidt Farms, LLC v Mendon Twp, 315 Mich App

824; NW2d (2016) also has no applicability as “the opinion specifically noted there was no dispute that the properties

were qualified agricultural properties.”

7

Although Respondent uses the word “complaint,” the only pleadings filed in the Tribunal are petitions and answers.

See TTR 221(1).

8

Petitioner cites Keyzer v Christian Rest Home Ass'n 32 Mich App 286, 288; 188 NW2d 672 (1971) for the proposition

that “[i]t is not for the court [[or, in the instant case, the Tribunal] to add language to a clear and explicit statute.”

Petitioner also cited Kirkaldy v Rim MD, et al, 478 Mich 581, 587; 734 NW2d 201 (2007), F. M. Sibley Lumber Co v

Dep't of Revenue, 311 Mich 654, 660; 19 NW2d 132 (1945).

9

Petitioner cites Davidson v Bugbee, 227 Mich App 264, 267; 575 NW2d 574 (1977) (citing Johnson v. Marks, et al,

224 Mich App 356, 358; 568 NW2d 689 (1997)) for the proposition that “[i]n construing a statute ... omissions in the

language are deemed to be intentional.”

10

Petitioner cites Eldenbrady v City of Albion, 294 Mich App 251,254; 816 NW2d 449 (2011) for the proposition that

“[t]he words contained in the statute provide ... the most reliable evidence of the Legislature's intent” and Pohidski v City

of Allen Park, 465 Mich 675, 638; 641 NW2d 219 (2002) for the proposition “[w]here the language is unambiguous,

‘we presume that the Legislature intended the meaning, looking outside the statute to ascertain the Legislature's intent

only if the statutory language is ambiguous.”

11

See TTR 223(7).

12

See TTR 261 and 215.

13

See Maiden v Rozwood, 461 Mich 109, 120; 597 NW2d 187 (1999) and Quinto v Cross and Peters Co, 451 Mich 358,

362; 547 NW2d 314 (1996).

14

See Smith v Globe Life Insurance Co, 460 Mich 446,454-5; 597 NW2d 28 (1999) and Quinto, supra at 362.

15

See Arbelius v Poletti, 188 Mich App 14, 18; 469 NW2d 436 (1991).

16

See Neubacher v Globe Furniture Rentals, Inc, 205 Mich App 418,420; 522 NW2d 335 (1994).

17

See McCart v J Walter Thompson USA, Inc, 437 Mich 109, 115; 469 NW2d 284 (1991).

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13

18

See McCormic v Auto Club Ins Ass'n, 202 Mich App 233,237; 507 NW2d 741 (1993).

19

See MCL 211.27a(8)(a).

20

Although Respondent makes this argument, it does recognize that the property received a qualified agricultural

exemption beginning in 2011. In that regard, there is some question as to why the property was receiving a principal

residence exemption (“PRE”) from 1999 to 2003 that is not addressed by Petitioner's affidavits, as those affidavits merely

indicate that the property was “primarily devoted” to agricultural uses during those years and from 2004 to 2010. The

fact that Respondent did, however, grant the property a qualified agricultural exemption of 100% beginning in 2011

does, however, address concerns regarding related buildings. See MCL 211,7dd(d)

21

See Ashley Capital, LLC v Dep't of Treasury, 314 Mich App 1, 7; 884 NW2d 848 (2015) (i.e., “‘tax statutes that grant

tax credits or exemptions are to be narrowly construed in favor of the taxing authority because such statutes reduce the

amount of tax imposed”D’ citing Alliance Obstetrics & Gynecology, PLC v Dep't of Treasury, 285 Mich App 284,286;

776 NW2d 160 (2009)).

22

See Michigan United Conservation Clubs v Lansing Twp, 423 Mich 661, 664-65; 378 NW2d 737 (1985).

23

See Spartan Stores, Inc v City of Grand Rapids, 307 Mich App 565, 569; 861 NW2d 347 (2014) (i.e., “[t]he primary

goal of statutory interpretation ‘is to discern and give effect to the intent of the Legislature”D’ citing Lafarge Midwest,

Inc v Detroit, 290 Mich App 240,246; 801 NW2d 629 (2010)).

24

See Bronson Methodist Hospital v Allstate Ins Co, 286 Mich App 219, 228; 779 NW2d 304 (2009) (i.e., the Legislature

“is presumed to know the rules of statutory construction and therefore its use or omission of language is generally

presumed to be intentional”).

25

See MCL 211.7ee(4) (i.e., “the assessor shall determine if the property is qualified agricultural property and if so shall

exempt the property from the collection of the tax as provided in subsection (1) until December 31 of the year in which

the property is no longer qualified agricultural property as defined in section 7dd”) and 211.7ee(5) (i.e., “[n]ot more

than 90 days after all or a portion of the exempted property is no longer qualified agricultural property, the owner shall

rescind the exemption for the applicable portion of the property by filing with the local tax collecting unit a rescission

form prescribed by the department of treasury”)- [Emphasis added.]

26

See MCL 211.2, MCL 211.7o, MCL 211.7cc, MCL 211.7dd, and MCL 211.79.

27

See Spartan Stores, supra at p 569. See also G C Timmis & Co v Guardian Alarm Co, 468 Mich 416,420-21; 662 NW2d

710 (2003) (i.e., “the emphasized language does not stand alone, and thus it cannot be read in a vacuum .... [i]nstead,

[i]t exists and must be read in context with the entire act, and the words and phrases used there must be assigned such

meanings as are in harmony with the whole of the statute” citing Arrowhead Dev Co v Livingston Co Rd Comm, 413

Mich 505, 516; 322 NW2d 702 (1982)).

28

See Bronson Methodist Hospital, supra at p 223 (i.e., “[w]here words “have acquired a peculiar and appropriate meaning

in the law,' they should be construed according to that meaning” citing Feyz v Mercy Memorial Hospital, 475 Mich 663,

673; 719 NW2d 1 (2006)).

29

See Ford Motor Co v Dep't of Treasury, 313 Mich App 572, 587; 884 NW2d 587 (2015), appeal denied, 887 NW2d

799 (2016) citing In re Certified Question, 468 Mich 109, 115 n. 5; 659 NW2d 597 (2003).

30

See VanGessel v Lakewood Public Schools, 220 Mich App 37,41; 558 NW2d 248,251 (1996) citing ABC Supply Co v

City of River Rouge, 216 Mich App 396, 398; 549 NW2d 73 (1996).

31

MCL 324.36101(b) provides:

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14

“Agricultural use” means the production of plants and animals useful to humans, including forages and sod crops;

grains, feed crops, and field crops; dairy and dairy products; poultry and poultry products; livestock, including breeding

and grazing of cattle, swine, captive cervidae, and similar animals; berries; herbs; flowers; seeds; grasses; nursery

stock; fruits; vegetables; maple syrup production; Christmas trees; and other similar uses and activities. Agricultural use

includes use in a federal acreage set-aside program or a federal conservation reserve program. Agricultural use does not

include the management and harvesting of a woodlot.

32

See Book-Gilbert v Greenleaf, 302 Mich App 538, 542; 840 NW2d 743, 745-46 (2013) citing In re Hurd-Marvin Drain,

331 Mich 504, 509; 50 NW2d 143 (1951) and Mich Basic Prop Ins Ass'n v Office of Fin & Ins Regulation, 288 Mich

App 552, 560; 808 NW2d 456 (2010).

33

The Court of Appeals also stated in Book-Gilbert, supra at p 542:

34

See Red Arrow Dairy, supra.

35

The properties at issue in both Red Arrow Dairy case and the Lyle Schmidt Farms case were considered qualified

agricultural property and entitled to the recapping. Neither case indicated that the properties were required to also have

a qualified agricultural exemption to be entitled to said recapping. Rather, the Court of Appeals in Lyle Schmidt Farms,

supra at p stated:

“Courts may not speculate regarding legislative intent beyond the words expressed in a statute. Hence, nothing may be

read into a statute that is not within the manifest intent of the Legislature as derived from the act itself.” Mich Ed Ass'n v

Secretary of State, 489 Mich 194, 217-218; 801 NW2d 35 (2011).... “The words used by the Legislature are given their

common and ordinary meaning.” Joseph v Auto Club Ins Ass'n, 491 Mich 200,206; 815 NW2d 412 (2012).

[Emphasis added.]

In that regard, the “common and ordinary meaning” of the phrase or phraseology when analyzed by its grammatical

components (i.e., the phrase “was qualified agricultural property” is a past participle verb, while “for taxes levied in

1999 and each year after 1999” is a prepositional phrase modifying that verb) merely indicates when the property was

required to be qualified agricultural property.

36

See MCL 205.753(1).

37

See MCL 211.27a(8) (i.e., “[i]f all of the following conditions are met, the local tax collecting unit shall revise the

taxable value of qualified agricultural propertyand Michigan Properties, LLC v Meridian Twp, 491 Mich 518, 531-32;

817 NW2d 548, 554 (2012). [Emphasis added.]

38

See MCL 211.27a(9) (i.e., “[i]f the taxable value of qualified agricultural property is adjusted under subsection (8), the

owner of that qualified agricultural property is not entitled to a refund for any property taxes collected under this act on

that qualified agricultural property before the adjustment under subsection (8)”).

39

See MCL 205.726.

40

See MCL 205.762(2) and TTR 289(1) and (2).

2017 WL 2634774 (Mich. Tax Tribunal)

End of Document

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1

2020 WL 4722048

Only the Westlaw citation is currently available.

UNPUBLISHED OPINION. CHECK

COURT RULES BEFORE CITING.

UNPUBLISHED

Court of Appeals of Michigan.

Robert J. HOFFMAN, Petitioner-Appellant,

v.

TOWNSHIP OF HIGHLAND, Respondent-Appellee.

No. 348939

|

August 13, 2020

Michigan Tax Tribunal, Small Claims Division, Docket No.

18-003579-TT

Before: Murray, C.J., and Cavanagh and Swartzle, JJ.

Opinion

Per Curiam.

*1 In this tax-exemption dispute, petitioner appeals as

of right the final opinion and judgment of the Michigan

Tax Tribunal (MTT) regarding respondent’s reduction of the

qualified-agricultural exemption for the 2018 tax year for a

parcel of real property owned by petitioner. 1 We affirm.

I. BACKGROUND

The parcel of real property at issue in this case is located in

Highland Township in Oakland County. It consists of 46 acres

of land on which are situated several structures, including

a twostory addition that was constructed in 2016 as an

attachment to an existing horse arena (the Observation/Wine

Tasting Room). The subject property is part of a 299-acre

farm, the remainder of which is situated in Rose Township.

The property is classified as residential, and located in

a district zoned for agricultural and rural-residential uses.

According to petitioner, the first floor of the Observation/

Wine Tasting Room is for use by patrons to safely observe

horse training and riding lessons through large windows that

overlook the horse arena, an ancillary use of the first floor

being for petitioner to display and sell his own brand of wine.

In order to serve wine in the Observation/Wine Tasting Room,

petitioner obtained a small winemaker’s license. Petitioner

states that he intends to use the second floor of the addition

as a farm office.

For the 2017 tax year, the subject property was deemed

eligible for 100% of the qualified-agricultural exemption

(QAE). For the 2018 tax year, however, respondent sought

to reduce the extent of the QAE on the ground that the

Observation/Wine Tasting Room was used for commercial

purposes, rather than agricultural purposes.

Plaintiff filed an exemption appeal in the MTT. Petitioner

argued that the QAE should be set at 100% because

petitioner’s primary use of the first floor of the Observation/

Wine Tasting Room was as an observation area and the

second floor as a farm office, both of which were agricultural

uses. Petitioner described the wine tasting as a secondary use

that was not motivated by profit but was instead provided

to improve the experience of the patrons of his equestrian

farm. In the alternative, petitioner argued that the QAE

should be 99% because, at most, only 225 square feet of the

Observation/Wine Tasting Room was used for wine tasting.

Respondent argued that the Observation/Wine Tasting Room

was used for a commercial purpose. Among other evidence,

respondent presented interior and exterior images of the

Observation/Wine Tasting Room culled from petitioner’s

website and other Internet sources.

*2 The MTT issued its final opinion and judgment in favor

of respondent, explaining as follows:

Respondent provided the Tribunal with photographs/

written information of and regarding, the property

observation/wine tasting room from the Hoffman Farms

website, Vinoshipper, a wine shipping company accessed

through the Hoffman Farms website, the Hoffman Farms

Facebook page, an Oakland County Blog referencing

“Brewed in Oakland County,” and “Detroitdvotion.” From

the photographs, it appear[s] the observation/wine tasting

room is equipped with many tables and a bar with a

granite countertop. In photographs are wine, wine glasses

and other wine related products which appear to be

presented for sale. There is a menu including prices for

three white wines, three hard ciders, cheese and meat tray

and hummus and pretzels. There is a list of past events,

including “Second Anniversary Fall celebration,” “Food

Truck Friday,” and “Hoffman Farms Winery Anniversary

Hayride.” There is information from “Detroitdvotion.com”

about “Hoffman Farms Winery and Tasting Room” which

MTT Docket No. 25-003108 

October 21, 2026 

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Hoffman v. Township of Highland, Not Reported in N.W. Rptr. (2020)

 © 2023 Thomson Reuters. No claim to original U.S. Government Works.

2

concludes, “Hoffman Farms is the perfect place to relax,

unwind, de-stress; from picturesque farm to the wine and

hard cider, you’ll be glad you came.”

There are photos of the observation/wine tasting room

depicting a fireplace, a table set with cheese, crackers,

vegetables and hummus. There appears to be a set-up for a

group with tablecloths, non-paper, plates, bowls and bread

plates, napkins, silverware, and water bottles at each place

setting. There is also an outdoor seating area with umbrella

tables. It is apparent, from the photographs, that the indoor

wine related facility is adjacent to large windows that look

out to the riding arena, but photographs of patrons at the bar

do not show any of them facing the windows. The outside

of the observation room/wine tasting facility is constructed

to appear to be a stately, pillared, white house. Petitioner

contends no one from the assessor’s office has visited the

property, however, also testified an assessing employee did

inspect the property in October 2016. The Tribunal finds

the observation room/wine tasting facility is used for a

commercial purpose, for property tax purposes.

The MTT stated that, because the Observation/Wine Tasting

Room was put to a commercial use, the QAE must be reduced

to reflect the extent of that non-agricultural use. The MTT

concluded that the property was entitled to receive a QAE

of 80% for the 2018 tax year. Petitioner filed a motion

for reconsideration, which the MTT denied. This appeal

followed.

II. ANALYSIS

In the absence of fraud, our review of decisions of the MTT

is limited to determining whether the tribunal made an error

of law or adopted a wrong principle; the factual findings of

the tribunal are final, provided that they are supported by

competent and substantial evidence. President Inn Properties,

LLC v. City of Grand Rapids, 291 Mich. App. 625, 631; 806

N.W.2d 342 (2011). Evidence is competent, material, and

substantial if a reasoning mind would accept it as sufficient

to support a conclusion. Lyle Schmidt Farms, LLC v. Mendon

Twp., 315 Mich. App. 824, 829; 891 N.W.2d 43 (2016). Under

this standard, “[m]ore than a scintilla of evidence is required,

although a preponderance of the evidence is not necessary.”

Id.

A. COMMERCIAL PURPOSE

*3 Petitioner argues that the MTT erred when it found

that the Observation/Wine Tasting Room was used for a

commercial purpose. We disagree.

The QAE is an exemption from certain local-school-operating

taxes. MCL 211.7ee(1). Only “qualified agricultural

property” is eligible for the QAE. MCL 211.7ee(2). Under

MCL 211.7dd(d), property that is not classified as agricultural

is considered “qualified agricultural property” if more than

50% of the parcel’s acreage is devoted to agricultural use, with

the term “agricultural use” being defined in MCL 324.36101.

MCL 211.7dd(d) also states, “An owner shall not receive

an exemption for that portion of the total state equalized

valuation of the property that is used for a commercial or

industrial purpose or that is a residence that is not a related

building.” In this case, because the property was classified as

residential, its QAE is based on use of the property, not its

classification.

Petitioner contends that the General Property Tax Act

(GPTA), MCL 211.1 et seq., requires a profit motive before

a use of a property may be considered commercial, and

he points to his unrefuted testimony that he had no intent

to make a profit from the wine-tasting operations, which

he claimed were intended to complement or promote his

equestrian business.

The legal authority cited by petitioner in support of this

argument is not on point. Two cited cases from the United

States Tax Court, and a section from the Code of Federal

Regulations, involve whether an activity was engaged in for

profit within the meaning of § 183 of the Internal Revenue

Code, 2 which pertains to deductions attributable to not-

for-profit activities. 3 Another cited case, from the Sixth

Circuit, involved whether the development costs of a mine

might be deducted under § 616 of the Internal Revenue

Code, which allows such deductions only if the primary

objective of the mining venture was to make a profit. 4 These

federal authorities are thus minimally instructive for present

purposes.

In his reply brief, petitioner cites MCL 211.27a(11)(c), which

defines “commercial purpose” for purposes of § 27a of the

GPTA as “used in connection with any business or other

undertaking intended for profit.” That definition, however, is

MTT Docket No. 25-003108 

October 21, 2026 

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Hoffman v. Township of Highland, Not Reported in N.W. Rptr. (2020)

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3

not applicable because § 27a addresses “commercial purpose”

in connection with transfers of ownership of real property,

while not addressing QAE eligibility. To the extent that MCL

211.27a(11)(c) is at least instructive for present purposes, it

does not support petitioner’s characterization of his wine-

tasting operation as non-commercial in nature. When he

insists in his brief on appeal that he undertakes that activity

“to provide a convenience and accommodation to boarders,

riders, parents and guests so as to enhance the agricultural

use on the Property”—in other words, to increase the appeal

of his equestrian business—petitioner is conceding that he

operates his wine-tasting side endeavor “in connection with”

the commercial use of the horse arena to which it is attached.

*4 Petitioner has failed to establish that MTT erred in linking

his use of the Observation/Wine Tasting Room to commercial,

as opposed to agricultural, purposes, and thus in reducing the

QAE accordingly.

B. PHOTOGRAPHIC EVIDENCE

Petitioner argues that the MTT erred in accepting

respondent’s photographs of the Observation/Wine Tasting

Room without first establishing such foundational elements

as photographer, dates, and occasions and persons depicted.

We reject this argument for several reasons.

First, petitioner did not raise this issue until his motion

for reconsideration, thus forfeiting appellate objections. See

Vushaj v. Farm Bureau Gen. Ins. Co. of Mich., 284 Mich. App.

513, 519; 773 N.W.2d 758 (2009); City of Wayne v. Michigan

State Tax Comm’n, 261 Mich. App. 174, 198; 682 N.W.2d 100

(2004). Our review is therefore restricted to ascertaining if

the tribunal below committed plain error affecting substantial

rights. See In re Utrera, 281 Mich. App. 1, 8; 761 N.W.2d 253

(2008); Kern v. Blethen-Coluni, 240 Mich. App. 333, 336; 612

N.W.2d 838 (2000).

Second, petitioner submitted the evidence in compliance with

the rule governing evidence in the small-claims division of

the MTT:

A copy of all evidence to be offered

in support of a party’s contentions

shall be filed with the tribunal and

served upon the opposing party or

parties not less than 21 days before

the date of the scheduled hearing,

unless otherwise provided by the

tribunal. Failure to comply with this

subrule may result in the exclusion

of the valuation disclosure or other

written evidence at the time of the

hearing because the opposing party

or parties may have been denied the

opportunity to adequately consider

and evaluate the valuation disclosure

or other written evidence before the

date of the scheduled hearing. [Mich.

Admin. Code, R 792.10287(1).]

In this case, respondent submitted its evidence more than 21

days before the hearing. Therefore, petitioner had sufficient

time to evaluate the evidence and could have raised objections

at the hearing.

Third, “a somewhat relaxed evidentiary standard applies to

administrative hearings.” Becker-Witt v. Bd. of Examiners of

Social Workers, 256 Mich. App. 359, 365; 663 N.W.2d 514

(2003). In this case, respondent had provided the URLs of

the websites from which the photographs were posted, and

it was reasonable for the MTT to rely on those photographs,

especially when petitioner raised no objections to them. The

MTT did not commit plain error when it relied upon the

challenged photographs to reach its decision regarding the

QAE.

C. EXTENT OF QAE REDUCTION

Petitioner alternatively argues that the MTT erred in finding

that the entire square footage of the Observation/Wine

Tasting Room was used for a commercial purpose, and thus

improperly calculated the reduction of the QAE. We disagree.

A review of the photographs in evidence shows that the

entire area of the Observation/Wine Tasting Room is utilized

for a commercial purpose. On the first floor, there are

tables throughout the Observation/Wine Tasting Room and

people can be seen drinking wine at places other than the

bar counter. There are also display cases containing wine-

related products, and an outdoor seating area. The MTT

also reviewed evidence from petitioner’s valuation appeal, 5

which included a photograph of the second floor where

a table was set for a meal. This constituted substantial

MTT Docket No. 25-003108 

October 21, 2026 

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Page 45

Hoffman v. Township of Highland, Not Reported in N.W. Rptr. (2020)

and competent evidence to support the MTT’s finding that

the entire Observation/Wine Tasting Room was used for a

commercial purpose.

*5 Petitioner argues that the 46-acre parcel at issue should

be valued as an integrated part of his entire 299-acre farm, and

thus that the QAE reduction covering the Observation/Wine

Tasting Room should be calculated as a fraction of that much

larger entirety. Petitioner acknowledges that MCL 211.7dd(d)

states that “[a]n owner shall not receive an exemption for that

portion of the total state equalized valuation of the property

that is used for a commercial or industrial purpose,” but

he contends that the GPTA does not define “property” as

“tax parcel,” and cites MCL 211.27a(2) as a provision that

specifically differentiates “property” from “parcel.” Section

27a of the GPTA, however, mentions “parcel” but once:

Following Subsection (1)’s statement that “property shall

be assessed at 50% of its true cash value,” Subsection (2)

introduces the bases for establishing “the taxable value of

each parcel of property.” This wording hardly suggests that

distinct uses on a contiguous fee should not be distinctly taken

into account. Based on the clear wording of MCL 211.7dd(d),

we reject this argument.

The MTT did not make an error of law or adopt a

wrong principle, and its factual findings were supported

by competent and substantial evidence, when it found that

the entire Observation/Wine Tasting Room was used for a

commercial purpose.

Affirmed.

All Citations

Not Reported in N.W. Rptr., 2020 WL 4722048

Footnotes

In his reply brief, petitioner asks this Court to take judicial notice that respondent’s attorney was not authorized

by her client to defend this appeal, on the ground that such action was contrary to respondent’s board of

trustees’ vote approving a motion not to continue the process to defend. Petitioner also offers a copy of the

minutes of the meeting cited. We decline to consider this argument because it is not properly before this

Court. A party may not raise new issues in a reply brief. MCR 7.212(G). Nor may a party enlarge the record

on appeal. MCR 7.210(A).

26 USC 1 et seq.

See Golanty v. Comm’r of Internal Revenue, 72 T.C. 411 (1979); Allen v. Comm’r of Internal Revenue, 72

T.C. 28 (1979); 26 CFR 1.183-2(a).

Bryant v. Comm’r of Internal Revenue, 928 F.2d 745, 748 (C.A. 6, 1991).

MTT Docket No. 18-003570-TT; see also this Court’s Docket No. 348938.

End of Document

MTT Docket No. 25-003108

October 21, 2026

P7-004

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P-8

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Transfer of Ownership Guidelines 

PREPARED BY THE MICHIGAN STATE TAX COMMISSION 

Revised February 25, 2025

MTT Docket No. 25-003108 

October 21, 2026 

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2 

 

TABLE OF CONTENTS 

 

Background Information 

 

 3 

 

Transfer of Ownership Definitions 

 

 4 

Deeds and Land Contracts 

 4 

Trusts 

5 

Distributions Under Wills or By Courts 

8 

Leases 

9 

Ownership Changes of Legal Entities 

(Corporations, Partnerships, Limited Liability Companies, etc.) 

10 

Tenancies in Common 

11 

Cooperative Housing Corporations 

12 

 

Transfer of Ownership Exemptions 

 13 

Spouses 

13 

Children and Other Relatives 

14 

Tenancies by the Entireties 

17 

Life Leases/Life Estates 

18 

Foreclosures and Forfeitures 

21 

Redemptions of Tax-Reverted Properties 

23 

Trusts 

23 

Court Orders 

25 

Joint Tenancies 

25 

Security Interests 

31 

Affiliated Groups 

32 

Normal Public Trades 

32 

Commonly Controlled Entities 

33 

Tax-Free Reorganizations 

34 

Qualified Agricultural Properties 

35 

Conservation Easements 

38 

Boy Scout, Girl Scout, Camp Fire Girls 

4-H Clubs or Foundations, YMCA and YWCA 

39 

Property Transfer Affidavits 

39 

Partial Uncapping Situations 

42 

Delayed Uncapping’s 

43 

MTT Docket No. 25-003108 

October 21, 2026 

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Page 49

Is a property which is 100 percent qualified agricultural property but will be

something less than 100 percent qualified agricultural property after a transfer

(example 75%) eligible for the qualified agricultural property transfer of ownership

exemption?

No. The taxable value of the parcel will be completely (100 percent) uncapped for the

following year. It is the opinion of the State Tax Commission that a reduction in the

percentage of qualified agricultural property exemption results in a total uncapping of

that parcel’s taxable value in the situation described above. The qualified agricultural

property transfer of ownership exemption does not provide for a partial uncapping in this

situation.

What happens if a split occurs and the split parcel is converted by a change in use?

If part of the property is split from the parcel and then the split parcel is converted by a

change in use, the taxable value of the split parcel is uncapped in the following year. The

taxable value of the remainder of the parcel which has not been converted by a change

in use remains capped. However, if part of the property is converted by a change in use

prior to or not involving a split, the taxable value of the entire parcel is to be uncapped in

the year following the change in use.

Can only a portion of a parcel uncap following a transfer of ownership if that portion

is no longer qualified agricultural property?

Under Public Act 375 of 2016, effective December 28, 2016, a transfer of ownership

includes an assessor's establishment of a separate tax parcel, at the request of the

property owner, for a portion of a parcel that ceased to be qualified agricultural property but

was not subject to a land division under the Land Division Act. The separate tax parcel

only will have the taxable value uncapped as of December 31 in the year that the separate

tax parcel ceases to be qualified agricultural property. The separate tax parcel that is no

longer qualified agricultural property is subject to the agricultural property recapture tax.

The status of the remaining portion of the original parcel is not affected by the

establishment of the separate parcel.

A parcel is 100% qualified agricultural property and could receive a 100% qualified

agricultural property exemption. However, the owner, who lives on the parcel,

claims the homestead exemption so that he can also claim a homestead

exemption on contiguous vacant property. If this parcel is transferred, could the

new owner benefit from the qualified agricultural property transfer of ownership

exemption even though the property is not receiving the qualified agricultural

property exemption?

Yes, provided that the new owner files the required affidavit with the local assessor

and the register of deeds attesting that the property will remain qualified agricultural

property. Statute requires that a property be qualified agricultural property to be

eligible for this transfer of ownership exemption. It is not required that the property be

receiving the qualified agricultural property exemption to be eligible for this transfer of

ownership exemption.

What happens if a property receives the qualified agricultural property transfer of

ownership exemption and later is converted by a change in use?

MTT Docket No. 25-003108

October 21, 2026

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P-9

Page 51

MTT Docket No. 25-003108 

October 21, 2026 

P9-001

MTT Docket No. 25-003108 

October 21, 2026 

P9-001 

AG. PROPERTY/RECAPTURE TAX 

i 

S.8.709 & 1246: ENROLLED ANALYSIS 

8 

dn 

Senate Fiscal Ayency 

ath 

Telephone: (517) 873-5383 

P. Q. Box 30036 

LY = A 

Fax: (617) 373-1986 

Lansing, Michigan 48909-7536 

Zh BILL ANALYSIS 

ToD! 51 » 373-0543 

Senate Bills 709 and 1246 (as enrolled) 

PUBLIC 

ACT! 

61 

of 

2000 

Sponsor: Senator Mike Goschka (S,8. 709) 

Senator George A. McManus (S.B. 1246) 

Senate Committee: Finance (S.B. 709) 

Farming, Agribusiness and Food Systems (S.B. 1246) 

House Committee; Agriculture and Resource Management 

Date Completed: 9-13-00 

RATIONALE 

Much has been sald 

in recent years about how 

agriculture has come under increasing economic 

pressures. To address this and other related issues, 

the Senate Agriculture Preservation Task Force was 

created in the spring of 1999. The task force was 

asked lo examine the condition of agriculture in 

Michigan and identify the challenges and threats it 

faces. 

After receiving testimony from over 250 

persons, 

the 

task 

force produced 

a 

report on 

agriculture In the State. 

The report states that the 

farm sector Is In the worst condition it has been in 

since the mid-1980s; prices for many commodities 

are as low as they have been in decades; few young 

people 

are entering 

agriculture; 

and 

economic 

pressures on farmers and processing industries are 

causing agricultural resources, including land, to be 

removed from farm production. Thereportconcludes 

that the fundamental cause of these problems is low 

profits, and that policies designed to address the 

issues facing agriculture should focus 

on profitability. 

The report lists 12 specific recommendations for 

State action, Including reducing taxes, developing 

new tax credits and enhancing current credits, and 

protecting farms against certain State and local 

regulations. 

In regard to tax reduction, the report 

recommends that the assessment cap on agricultural 

property be maintained when agricultural property is 

transferred. 

Currently, under Article 9, Section 3 of the State 

Constitution, annual assessment increases on each 

parcel of properly (adjusted for additions and losses) 

are limited to the lesser of 5% or the rate of inflation. 

When 

property 

Is subsequently transferred 

(as 

defined by law), the assessed value reverts to 50% 

of true cash value (the State equalized valuation). 

As a result of the cap, each parcel has two values: 

the taxable value, which reflects the parcel's capped 

value and is the basis upon which taxes are levied; 

and the State equalized valuation (SEV), which isa 

measure of the value of the property on the open 

Page 10of 5 

market. Thus, in an area where the value of properly 

rises faster than the rate of inflation or 5% per year, 

a parcels taxable value will be lower than Its SEV, 

and this discrepancy will grow larger each year. 

When the property is transferred, the new owner 

must pay taxes based upon the property's SEV. 

It has been pointed out that this increase in property 

taxes can 

be 

particularly burdensome 

to those 

purchasing 

farm 

property, 

because such sales 

usually involve substantial tracts of valuable land. 

It 

has 

been 

suggested 

that, 

under 

certain 

circumstances, 

the 

assessment 

on 

transferred 

agricultural property should remain capped ifthe new 

owner keeps the property in agricultural use. 

In 

addition, 

since 

capping 

the 

assessment 

on 

transferred agricultural property will benefit the new 

owner, it has been suggested that the benefit should 

be recaptured if the property is converted to another 

use. 

CONTENT 

Senate Blil 709 amended the General Property 

Tax Act to specify that a transfer of ownership of 

property does not include a transfer of qualified 

agricultural property under certain conditions. 

(This means that annual assessment increases 

will remain limited to the lesser of 5% or the rate 

of Inflation and the assessed value will not revert 

to 50% of true cash value upon the transfer.) 

Property that ceases to be qualified agricultural 

property after it is transferred will be subject to a 

recapture tax. 

Senate 

Bill 

1246 created the 

“Agricultural Property Recapture Act” to impose 

a 

recapture 

tax 

on 

transferred 

agricultural 

property that is converted by a change in use so 

thatitis no longer qualified agricultural property; 

and to require that revenue from the recapture 

tax be deposited in the Agricultural Preservation 

sb709&1246/9900

Page 52

MTT Docket No. 25-003108 

October 21, 2026 

P9-002

Fund. The bills were tie-barred. 

Senate Bill 709 

The bill provides that a transfer of ownership of 

property does not include a transfer of “qualified 

agricultural property”, 

if the person to whom the 

properly is transferred files an affidavit with the 

assessor of the local tax collecting unit and with the 

register of deeds for the county In which the property 

is located, altesting that the property will remain 

qualified agricultural property. The affidavit must be 

in a form prescribed by the Depariment of Treasury. 

An owner of qualified agricultural property must 

inform a prospective buyer of the property that it is 

subject 

to 

the 

recapture 

tax, 

provided 

in 

the 

Agricultural Property Recapture Act, if the qualified 

agricultural property Is “converted by a change in 

use" (as defined in that Act). 

If property ceases lo be 

qualified agricultural property at any time after being 

transferred, it Is subject to the recapture tax, and the 

taxable value of the property, as of December 31 in 

the 

year 

it ceases 

to 

be 

qualified 

agricultural 

property, 

will 

be the properly's State equalized 

valuation. 

The 

bill provides 

that 

if the owner of qualified 

agricultural property files an affidavit attesting that 

the 

property 

will 

remain 

qualified 

agricultural 

property, and the property was qualified agricultural 

property for taxes levied in 1999 and each year 

thereafter, then the local tax collecting unit must 

revise the taxable value of the property to the taxable 

value that the property would have had if there had 

been no transfer of ownership of the properly, and 

there had been no adjustment of the property’s SEV, 

since December 31, 1999. 

If the taxable value of 

qualified agricultural property is adjusted according 

fo these provisions, the property's owner is not 

entitled to a refund for any properly taxes that were 

collected on the property before the adjustment was 

made. 

(Under the General Property Tax Act, “qualified 

agricultural property” is unoccupied properly and 

related buildings classified as agricultural, or other 

unoccupied properly and related buildings located on 

that property devoted primarily to agricultural use. 

Related buildings Include a residence occupied by a 

person who is employed in or actively involved in the 

agricultural 

use 

and 

who 

has 

not 

claimed 

a 

homestead exemption on other property. 

Property 

used 

for 

commercial 

storage, 

commercial 

processing, 

commercial 

distribution, 

commercial 

marketing, or commerclal shipping operations or 

other commercial 

or industrial purposes 

is 

not 

qualified agricultural property. A parcel of property is 

devoted primarily 

to agricultural use only if more than 

50% of its acreage is devoted to agricultural use.) 

Page 

2 of 5 

MTT Docket No. 25-003108 

October 21, 2026 

Senate Bill 1246 

The blll provides that beginning January 1, 2001, the 

agricultural property recapture tax will be imposed if 

property meets all of the following conditions: 

-- 

Itwas transferred after December 31, 1999. 

- 

It 

Is “converted 

by 

a change 

In 

use” 

after 

December 31, 2000. 

-- 

The taxable value 

of 

the 

property was 

not 

adjusted to its SEV after its iransfer, due to the 

provisions of Section 27a(7)(n) of the General 

Property Tax Act (under which 

a transfer of 

ownership does not include a transfer 

of qualified 

agricultural property if the new owner files an 

affidavit attesling that the properly will remain 

qualified agricultural property). 

Under the bill, “converted by a change in use” means 

either of the following: 

-- The property Is no longer considered qualified 

agricultural 

property 

as 

determined 

by 

the 

assessor of the local tax collecting unit, due to a 

change in use. 

-- The purchaser of qualified agricultural property, 

prior to a transfer, files a notice of intent to 

rescind 

the 

qualified 

agricultural 

properly 

exemption under Section 7ee of the General 

Properly Tax Act, and delivers a copy of that 

notice 

to the seller. 

(Section 7es exempts 

qualified agricultural property from local schoa! 

district operating millage, but requires an owner to 

rescind the exemption within 80 days after the 

exempted 

properly 

is 

no 

longer 

qualified 

agricultural 

property.) 

If 

the 

sale 

Is 

not 

consummated within 120 days of the filing of the 

notice, then the property is not converted by a 

change in use. 

The recapture tax imposed by the blll is “the bensfit 

received on the property”, which is calculated in the 

following manner: 

Benefit = Ax (B-C) 

“A” is the sum of the number of mills levied in the 

local tax collecting unit on the qualified agricultural 

property in each year of the “benefit period”. 

The 

“benefit pericd” is the period in years between the 

date of the first exempt transfer (a conveyance that 

is not a transfer of ownership pursuant to Section 

27a(7)(n) of the General Property Tax Act) and a 

conversion by a change in use, for up to seven years 

immediately preceding the yearin which the qualified 

agricultural property is converted by a change in use. 

“Bis the "true cash taxable value” of the property in 

each year of the benefit period. (“True cash taxable 

value” is the taxable value the property would have 

had if Section 27a(7)(n) were not In effect.) “C" is the 

sb709&1246/9900 

P9-002

Page 53

MTT Docket No. 25-003108 

October 21, 2026 

P9-003

property's taxable value. 

Under 

the 

bill, 

the 

determination 

of 

who 

is 

responsible for paying the recapture tax Is based 

upon how 

the 

qualified 

agricultural property 

is 

converted by a change in use. 

If the assessor of the 

local tax collecting unit determines that the property 

Is no longer qualified agricultural property due to a 

change in use, the recapture tax Is the obligation of 

the person who owned the properly at the time the 

property was converted by a change in use. The tax 

is a lien on the property until paid. 

If the recapture 

taxis not paid within 90 days of the date the properly 

was converted by a change In use, the treasurer may 

bring a civil action against the owner of the properly 

as of the date il was converied by a change in use. 

If the recapture tax remains unpald on March 1in the 

year immediately succeeding the year in which the 

property was converted by a change in use, the 

property must be returned 

as delinquent to the 

county lreasurer. 

Properly returned as delinquent, 

and upon which the recapture tax, interest, penalties, 

and fees remain unpaid 

after 

it 

is returned as 

delinquent to the county treasurer, 

Is subject to 

forfeiture, foreclosure, and sale for the enforcement 

and collection of the delinquent taxes as provided in 

the General Property Tax Act. 

If qualified agriculture properly is converted by a 

change in use because the purchaser files a notice 

of Intent to rescind the qualified agricultural property 

exemption, the recaplure tax is imposed on the 

person who owned the property before the transfer. 

The taxis due when the Instruments transferring the 

property are recorded with the register of deeds, who 

may 

not 

record 

an instrument transferring 

the 

property before the recapture tax is paid. 

The assessor of a local tax collecting unit must notify 

the county treasurer of the date qualified agricultural 

property is converted by a change in use. 

The county treasurer must collect the recapture tax 

and deposit it with the State Treasurer. By the 15th 

day of each month, on a form prescribed by the State 

Treasurer, the county treasurer must itemize the 

recapture taxes collected the preceding month and 

transmit 

the form 

and 

the 

taxes 

to 

the 

State 

Treasurer. 

The county treasurer may retain the 

interest earned on the money collected while held by 

the county treasurer as reimbursement for the costs 

incurred by the county in collecting and transmitting 

the tax. The money retained by the county treasurer 

must be deposited in the treasury of the county in 

Which the taxis collected, to the credit of the general 

und. 

The State Treasurer must credit the proceeds of the 

recapture tax collected by county lreasurers to the 

fund in which the proceeds from lien payments made 

Page 30of 5 

MTT Docket No. 25-003108 

October 21, 2026 

under Part 361 

of the 

Natural Resources and 

Environmental Protection Act are deposited. 

(Part 

361 provides for development rights agreements 

between landowners and the State, which restrict 

development on the land for a specified period of 

time In exchange for credits agalnst property taxes. 

The Slate may place a lien on the land, under certain 

circumstances, to recover the taxes if the land is 

removed 

from 

the 

confines 

of the agreement. 

Proceeds from lien payments are used by the State 

to purchase development rights and to administer 

Part 361. Beginning October 1, 2000, the unspent 

and unapproprlated proceeds fram lien payments 

made under Part 361 must be deposited 

in the 

Agricultural Preservation Fund (created by Pubtic Act 

262 of 2000). The Fund is to be used to administer 

Part 

361; 

to 

provide 

grants 

to 

local 

units 

of 

government 

for 

the 

purchase 

of 

“agricultural 

conservation easements”; and to enable the State to 

purchase 

development 

rights 

or 

agricullural 

conservation 

easements. 

An 

“agricultural 

conservation easement” is a conveyance of property 

in which the owner relinquishes to the public In 

perpetuity his or her development rights and makes 

a covenant running with the land not to undertake 

development.) 

The blll provides that it must be administered by the 

Revenue Division of the Department of Treasury. 

MCL 211.27a (S.B. 709) 

211.1001-211.1007 (S.B. 1246) 

ARGUME| 

(Please note: 

The arguments centeined in his enalysis 

originale from sources oulside the Senale Fiscal Agency. The 

Senale 

Fiscal 

Agency 

neither 

supports 

nor 

opposes 

leglstation.) 

Supporting Argument 

Farming remains an enormous part of the overall 

economy of Michigan. 

According to the Michigan 

Agriculture Statistics Service, the agricultural sector 

adds over $4 billion to the State's economy each 

year. Nevertheless, farmers are facing difficult times. 

Agricultural prices, adjusted for inflation, are at their 

lowest levels since the depression, according to the 

Agricultural Preservation Task Force report. Some 

focd processing plants have closed or moved out of 

the State. Low profitability in agricultural operations 

has caused many farmers to transfer thelr assets 

(land) to nonfarmers, usually developers. This has 

resulled In a steady reduction in the number of acres 

in farm production. Many people feel that this will 

hava long-term negative consequences for society in 

general, because it will reduce the nation's ability to 

provide food for an ever-increasing population, and 

increase U.S, dependence on foreign producers. 

$b709&1246/9900 

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Page 54

MTT Docket No. 25-003108 

October 21, 2026 

P9-004

Since the 1994 passage 

of Proposal A, which 

created a new State school funding system, there 

has been an assessment cap that limits a parcels 

annual assessment increase to the rate of Inflation or 

5%, whichever is less. The assessment cap has led 

to substantial differences between the taxable value 

of farmland and its SEV (based on market value). 

While this has kept taxes lower than they otherwise 

would 

be, 

the 

cap 

Is 

lifted when 

properly 

is 

transferred. This means that if a young farmer wants 

to purchase 

a farm from 

a retiring farmer, the 

assessed value of the property--and the taxes on it-- 

will “pop up” upon transfer of the land. 

By ensuring that, when transferred, farm property will 

continue to be assessed based upon its capped 

value rather than its open-market value, Senate Bill 

709 will prevent farmers’ property taxes from rising 

dramatically, and thus will increase the farmers’ 

chances of remaining profitable. 

Supporting Argument 

Taxes must be included In the cost of production; 

therefore, higher taxes result in lower profits. 

In the 

case of a transferred farm In a developing area, an 

assessment based upon the SEV rather than the 

farm's 

value 

under 

the 

assessment 

cap 

may 

preclude future use of the land for farming; that Is, 

when the property is lransferred either by sale or to 

an heir, the new assessment may raise the properly 

taxes to the point at which the new owner can no 

longer make a viable profit by farming the land. The 

next 

logical 

step, 

then, 

is 

to 

sell 

the 

land 

to 

developers for residential, commercial, or industrial 

use, thus removing the land from farm production. 

Once this happens, the property is almost never 

returned to farmland. The State should take steps to 

ensure 

that agriculture remains 

a 

vital 

part 

of 

Michigan's economy, and to do that the Stale must 

do whatit can to help farmers. By implementing one 

of several recommendations made by the Task Force 

to provide substantial tax relief to farmers, Senate 

Bill 709 will help to keep farmland as farmland. 

Supporting Argument 

Senate Bill 1246 institutes a tax that, upon a change 

in use, will recapture any benefil (for up to seven 

years) that a farmer has realized as a result of 

keeping his or her land in agricultural use. 

This 

creates 

a substantial incentive 

for an owner of 

farmland fo keep it in agriculture. 

Opposing Argument 

The recapture tax provided for in Senate Bill 1246 

has generated criticism from both developers and 

preservationists. Some people oppose any form of 

recapture taxwhen agricullural property is converted 

by a change in use, arguing that it infringes upon 

owners’ property rights and restricts the owners’ 

ability to do as they wish with their property. Others 

Page 4 of 5 

Bill Analysis @ hitp:/Awww.state.ml.us/sfa 

MTT Docket No. 25-003108 

October 21, 2026 

argue that attempts to assist farmers through tax 

policy are diminished by a recapture tax, which 

penalizes not only those farmers who want to profit 

from the development of land, but the developers 

and 

all those who benefit directly and indirectly 

through 

the 

construction 

of 

residential 

and 

commercial 

areas. 

Still 

others 

contend 

that 

recapture tax revenues should not be placed in the 

new Agricultural Preservation Fund, to be used for 

the 

purpose 

of 

selting 

aside 

land 

for 

nondevelopment, because (fat will have the effect of 

reducing the availability of land for development and 

Increasing the cost of the fand that Is left. 

From another direction, others say that the recapture 

tax is inadequate; will do little to discourage the 

development 

of farmland; 

and 

in fact may 

(in 

conjunction 

with 

Senate 

Bill 

709) 

encourage 

developers to purchase farms now, keep them in 

farming lo lake advantage of the lower taxes, and 

develop the land 

later. 

Some belleve that the 

recapture tax should impose a higher penalty than 

Just a repayment of the benefit received, in order not 

only to provide a stronger Incentive to keep farmland 

In agricultural production, but also to supply the Fund 

with more money so that more land can be set aside 

for preservation. 

Legislative Analyst: G. Towne 

FISCAL IMPACT 

The provisions in Senate Bill 709 will reduce property 

taxes by an estimated $2.1 million in FY 2000-01. 

Local government property tax revenue will decline 

$0.9 million and property taxes collected by schools 

(K-12, intermediate school districts, and community 

colleges) will decrease $0.7 million from what they 

otherwise would 

be. 

State government will be 

affected 

by 

a 

$0.5 

million 

reduction 

In 

State 

education tax revenue, but also will have to pay an 

additional $0.2 million to reimburse K-12 schools for 

their loss In local property taxes due to the State’s 

guaranteed funding levels. The new recapture tax, 

which is created in Senate Bill 1246, is not expected 

to generate any meaningful amounts of revenue in 

FY 2000-01. 

Fiscal Analyst: 

J. Worlley 

AS800\s703ea 

This analysis was prepared by nonpartisan Senate staff for use 

by the Senate In is deliberations and does not constitute an 

official statement of leglslative intent. 

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