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SB 423

Property tax: delinquent taxes; sunsets on certain delinquent tax payment reduction and foreclosure avoidance programs; modify. Amends sec. 78g & 78q of 1893 PA 206 (MCL 211.78g & 211.78q).

2025-2026 Regular Session Introduced by Mary Cavanagh and 3 co-sponsors

Senate Bill 423 extends tax relief programs for homeowners facing financial hardship, allowing reduced delinquent taxes and preventing foreclosure through new agreements.

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Bill Summary · SB 423

Summary of Senate Bill 423 (SB 423)

Overview

Senate Bill 423, introduced by Senator Stephanie Chang on February 26, 2025, aims to amend the General Property Tax Act in Michigan. The bill focuses on extending provisions related to delinquent property taxes, specifically concerning payment reduction measures and foreclosure avoidance agreements.

Purpose and Intent

The primary intent of SB 423 is to assist property owners facing financial hardship by extending the availability of programs designed to reduce delinquent property taxes and prevent foreclosure. This is particularly relevant in light of the ongoing challenges many families face in maintaining home ownership amid economic pressures.

Key Provisions

  1. Extension of Sunset Dates:

    • The bill extends the sunset date for provisions allowing for the reduction of delinquent taxes on forfeited properties from July 1, 2025, to July 1, 2030.
    • It eliminates the sunset date for tax foreclosure avoidance agreements, allowing county treasurers to enter into these agreements indefinitely.

  2. Payment Reduction Measures:

    • Local governmental units can reduce delinquent taxes owed on properties, cancel some or all service-related charges, and waive interest penalties and fees under certain conditions.

  3. Foreclosure Avoidance Agreements:

    • County treasurers may enter into agreements for up to five years with property owners classified as residential real property, provided the owner makes an initial payment determined by the treasurer.

  4. Financial Hardship Considerations:

    • The Act allows for withholding properties from the delinquency process in cases of substantial financial hardship, enabling local governments to offer various options to assist property owners.

Impact

  • Affected Parties: The bill primarily impacts homeowners with delinquent property taxes, local governmental units, and county treasurers.
  • Fiscal Considerations:
    • The extension of the sunset provisions is expected to have a minor negative fiscal impact on the state and an indeterminate impact on local governments.
    • If delinquent tax liabilities are reduced, local government revenues may decrease; however, if these taxes would not have been collected otherwise, the net fiscal impact could be positive.
    • Administrative costs for implementing these provisions are anticipated to be minimal and absorbed under existing budgets.

Legislative Process

  • Current Status: SB 423 has been referred to the Committee on Government Operations after passing the Senate on October 29, 2025, with a vote of 34 in favor and 1 against.
  • Next Steps: The bill is now awaiting further consideration and potential action by the Committee on Government Operations.

Conclusion

Senate Bill 423 seeks to provide critical support to homeowners struggling with delinquent property taxes by extending and modifying existing programs aimed at reducing tax burdens and preventing foreclosure. By doing so, it aims to foster stability in housing and support families facing financial difficulties.

Compiled from official sources — confirm details with the bill’s official record.

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