TAX ON LOW GRADE IRON ORE

MCL ch. 211, subtit. Act 77 of 1951

in effect

MCL 211.621 Definitions.

211.621. Definitions. Sec. 1. As used in this act: (a) "Low grade iron ore" means iron-bearing rock, also known as iron formation, jasper, ferruginous chert, or ferruginous slate, that is not merchantable as ore in its natural state and from which a merchantable product can be produced only by beneficiation or treatment involving fine grinding. (b) "Low grade iron ore mining property" means mineral bearing land from which low grade iron ore is mined, and includes the beneficiation or treatment plants, and other necessary land, buildings, facilities, equipment, tools, and supplies used in connection with the mining, transportation, and beneficiation or treatment of the low grade iron ore in producing merchantable iron ore pellets or other concentrated or agglomerated products. For the 1987 tax year only, low grade iron ore mining property includes a coal-fired power generating facility or a portion of a coal-fired power generating facility if all of the following conditions are met: (i) The power generating facility or portion of the power generating facility has a manufacturer's rated capacity of 400 megawatts or less and produces power that for 1987 is reserved for use by other low grade iron ore mining property before that power is used for other purposes. Not more than 30 days after the effective date of the amendatory act that added this subparagraph, the owner of the power generating facility on tax day of the 1987 tax year shall certify the portion of the facility reserved for first use by the mining operation for 1987. (ii) The power generating facility or portion of the power generating facility is owned directly or indirectly on tax day of the 1987 tax year by a person or corporation that owns directly or indirectly at least 15% of the other low grade iron ore mining property for which the power is reserved. 1951, Act 77, Imd. Eff. May 28, 1951; Am. 1959, Act 147, Eff. Mar. 19, 1960; Am. 1978, Act 537, Imd. Eff. Dec. 21, 1978; Am. 1987, Act 277, Imd. Eff. Jan. 6, 1988 [Compiler] Section 2 of Act 277 of 1987 provides: “This act shall be known and cited as the 'James Goulette iron ore recovery act of 1987'.”

MCL 211.622 Specific tax on mining property before production of ore or construction of plants.

211.622. Specific tax on mining property before production of ore or construction of plants. Sec. 2. Before the first calendar year in which production of merchantable ore from a low grade iron ore mining property has been established on a commercial basis, or before the period of construction of the plants for the beneficiation or treatment of low grade iron ore and the period of experimental operation of the plants, the low grade iron ore mining property shall be subject to a specific tax equal to the rated annual capacity of the plant in gross tons multiplied by .55% of the mine value per gross ton, based upon the projected natural iron analysis of the iron ore pellets or of the concentrated and/or agglomerated products, multiplied by the percent of construction completion of the low grade iron ore mining property. 1951, Act 77, Imd. Eff. May 28, 1951; Am. 1959, Act 147, Eff. Mar. 19, 1960; Am. 1978, Act 537, Imd. Eff. Dec. 21, 1978 [Compiler] Sec. 2, as amended by Act 324 of 1993, did not take effect pursuant to the terms of the act.

MCL 211.623 Specific tax on mining property after production of ore; determination of mine value; “lower lake price” defined.

211.623. Specific tax on mining property after production of ore; determination of mine value; “lower lake price” defined. Sec. 3. (1) Beginning with the first calendar year after production of merchantable ore from a low grade iron ore mining property has been established on a commercial basis, the low grade iron ore mining property shall be subject to a specific tax equal to the average annual production in gross tons during the preceding 5-year period, multiplied by 1.1% or beginning December 31, 2001 through December 31, 2006 0.75% of the mine value per gross ton, based on the average natural iron analysis of shipments for that year of the iron ore pellets or of the concentrated or agglomerated products. A year in which production did not take place shall be excluded in computing the average production but only until the property has a 5-year record of commercial production. Mine value is determined by subtracting from the published lower lake price of Lake Superior iron ore pellets, or the particular concentrated or agglomerated products as of December 31, for the subsequent calendar year, all the transportation and handling costs, including any tax charged for transporting or handling the iron ore pellets or products, from the mining property to Lake Erie ports. (2) As used in this section, "lower lake price" means the base price of Lake Superior district iron ore pellets or of the particular concentrated or agglomerated products at rail of vessel at lower lake ports as published in "Iron Age" published in New York City, New York, and "Industry Week" published in Cleveland, Ohio. If either "Iron Age" or "Industry Week" is not published or does not publish a price, a replacement trade journal recognized and generally accepted as reliable by the iron ore industry shall be substituted. If "Iron Age" or "Industry Week" do not publish the same price, if 1 of the trade journals publishes 2 different prices, or if the replacement trade journal does not publish a price, the price shall be the generally prevailing market price at which iron ore pellets or concentrated or agglomerated products, of comparable quality and utility, are being offered for sale in comparable quantity by or on behalf of bona fide producers from sources in the continental United States or Canada. 1951, Act 77, Imd. Eff. May 28, 1951; Am. 1959, Act 147, Eff. Mar. 19, 1960; Am. 1978, Act 537, Imd. Eff. Dec. 21, 1978; Am. 2002, Act 443, Imd. Eff. June 17, 2002 [Compiler] Sec. 3, as amended by Act 324 of 1993, did not take effect pursuant to the terms of the act.

MCL 211.624 Minimum specific tax; entering land descriptions on separate roll; spreading and collecting specific tax; return and sale of property for nonpayment of taxes; valuation; property located in more than 1 township; distribution and use of sums collected; specific tax in lieu of ad valorem tax; determining proportion for disbursement and attribution of taxes; payment.

211.624. Minimum specific tax; entering land descriptions on separate roll; spreading and collecting specific tax; return and sale of property for nonpayment of taxes; valuation; property located in more than 1 township; distribution and use of sums collected; specific tax in lieu of ad valorem tax; determining proportion for disbursement and attribution of taxes; payment. Sec. 4. (1) If the specific tax determined under section 3 is less than the specific tax determined under section 2, then section 2 shall govern. (2) The township supervisor shall remove from the list of land descriptions assessed and taxed under the general property tax act, 1893 PA 206, MCL 211.1 to 211.157, the land descriptions of property taxed under this act, and shall enter the land descriptions on a separate roll. The township supervisor shall spread the specific tax against the property and the township treasurer shall collect the specific tax at the same time, in the same manner, and subject to the same collection charges as general property taxes under the general property tax act, 1893 PA 206, MCL 211.1 to 211.157. Property listed and taxed under this act shall be subject to return and sale for nonpayment of taxes in the same manner, at the same time, and under the same penalties as property returned and sold for nonpayment of taxes levied under the general property tax act, 1893 PA 206, MCL 211.1 to 211.157. A valuation shall not be determined for a description listed under this act and the property shall not be considered by the county board of commissioners or by the state board of equalization in connection with county or state equalization for taxation purposes. If a low grade iron ore mining property is located in more than 1 township, the state geologist shall determine the portion attributable to each township. Except as provided in subsections (5) and (6), sums collected under this act shall be distributed by the township treasurer to school districts, this state, and to local governmental units in the same proportion as the general property taxes are distributed. The amounts distributed may be used by the school districts and local governmental units for operating expenses, for capital improvements, and for the accumulation of reserves in a building and site fund or for the payment of interest or principal on bonds. (3) The tax provided in this act shall be in lieu of an ad valorem tax on any of the following: (a) The low grade iron ore. (b) The low grade iron ore mining property. (c) The mining of the low grade iron ore mining property. (d) The production of iron ore pellets or other concentrated or agglomerated products. (e) The iron ore pellets or other concentrated or agglomerated merchantable products. (f) Land occupied by or used in connection with the mining, transportation, and beneficiation of the ore and shipping of iron ore pellets or other concentrated or agglomerated merchantable products. (4) For specific taxes levied after 1993, to determine the proportion for the disbursement of taxes under this section and for attribution of taxes under subsection (5) for the specific taxes collected pursuant to this act, the number of mills levied for local school district operating purposes to be used in the calculation shall equal the number of mills for local school district operating purposes levied in 1993 minus the number of mills levied under the state education tax act, 1993 PA 331, MCL 211.901 to 211.906, for the year for which the disbursement is calculated. (5) For specific taxes levied after 1993 and school operating purposes, the amount that would otherwise be disbursed to a local school district shall be paid instead to the state treasury and credited to the state school aid fund established by section 11 of article IX of the state constitution of 1963. (6) The proceeds of the specific tax levied under subsection (1) beginning December 31, 2001 through December 31, 2006 shall be distributed as follows: (a) To school districts and local governmental units the same amount that they would have been entitled to receive if the specific tax rate were 1.1%. (b) After the distribution under subdivision (a) is made, the remaining proceeds shall be deposited into the state school aid fund. 1951, Act 77, Imd. Eff. May 28, 1951; Am. 1959, Act 147, Eff. Mar. 19, 1960; Am. 1961, Act 21, Imd. Eff. May 10, 1961; Am. 1978, Act 537, Imd. Eff. Dec. 21, 1978; Am. 1987, Act 277, Imd. Eff. Jan. 6, 1988; Am. 1994, Act 367, Imd. Eff. Dec. 27, 1994; Am. 2002, Act 443, Imd. Eff. June 17, 2002 [Compiler] Section 2 of Act 277 of 1987 provides: [Compiler] "This act shall be known and cited as the 'James Goulette iron ore recovery act of 1987'." [Compiler] Sec. 4, as amended by Act 324 of 1993, did not take effect pursuant to the terms of the act. [Compiler] For transfer of powers and duties of department of environmental quality to department of natural resources and environment, see E.R.O. No. 2009-31, compiled at MCL 324.99919.

MCL 211.625 Purpose of act.

211.625. Purpose of act. Sec. 5. The purpose of this act is to encourage commercial development of and uniform production from low grade mineral resources in the state of Michigan. 1951, Act 77, Imd. Eff. May 28, 1951; Am. 1959, Act 147, Eff. Mar. 19, 1960

MCL 211.626 Appropriation; purpose.

211.626. Appropriation; purpose. Sec. 6. There is appropriated from the general fund $1,651,000.00 for reimbursement of governmental units and school districts for the amount by which property tax revenue, excluding revenue included in the calculation of payments made under section 21(1) of the state school aid act of 1979, Act No. 94 of the Public Acts of 1979, being section 388.1621 of the Michigan Compiled Laws, is reduced as a result of the inclusion of a power generating facility or a portion of a power generating facility in the definition of lowgrade iron ore mining property. Add. 1987, Act 277, Imd. Eff. Jan. 6, 1988 [Compiler] Section 2 of Act 277 of 1987 provides: “This act shall be known and cited as the 'James Goulette iron ore recovery act of 1987'.”

Source: Michigan Legislature (legislature.mi.gov)URL: https://legislature.mi.gov/documents/mcl/Chapter%20211.xmlFetched: 10/20/2026