FORECLOSURE AVOIDANCE SUNSET S.B. 423 (S-1):
SUMMARY OF BILL
REPORTED FROM COMMITTEE
Senate Bill 423 (Substitute S-1 as reported)
Sponsor: Senator Stephanie Chang
Committee: Finance, Insurance, and Consumer Protection
FORECLOSURE AVOIDANCE SUNSET S.B. 423 (S-1):
SUMMARY OF BILL
REPORTED FROM COMMITTEE
Senate Bill 423 (Substitute S-1 as reported)
Sponsor: Senator Stephanie Chang
Committee: Finance, Insurance, and Consumer Protection
CONTENT
The bill would amend the General Property Tax Act to extend the sunsets on provisions that allow for payment reduction measures and foreclosure avoidance agreements on eligible property with delinquent property taxes.
BRIEF RATIONALE
The Pay As You Stay (PAYS) program was enacted in 2020 and generally is a multi-step plan to assist families in avoiding foreclosure of their homes. According to testimony, the PAYS program has helped families to stay in their homes, even when struggling to catch up on delinquent property tax payments. Some have suggested that the PAYS program be continued.
Legislative Analyst: Nathan Leaman
FISCAL IMPACT
The bill would eliminate two sunset provisions related to the collection of property taxes. One eliminated sunset concerns a provision allowing the reduction of delinquent taxes owed on a forfeited property under certain circumstances. Eliminating the sunset would have a minor negative fiscal impact on the State and an indeterminate fiscal impact on local government. If the delinquent tax liability were reduced, revenue to the local government also would be reduced; however, if the taxes collected would not have been collected otherwise, the net fiscal impact for the local government would be positive. Any additional administrative costs for county treasurers or the State would be minimal and would be absorbed under existing appropriations. Since the provisions would be voluntary for local units of government, the total impact is impossible to estimate and would depend on how exactly the provisions were used.
The bill also would eliminate a sunset on provisions for a foreclosing governmental unit to enter an installment payment plan with an eligible taxpayer and thus would maintain an option for collecting property tax revenue and preventing foreclosure. The bill would have an unknown but likely minimal fiscal impact on State and local property tax revenue.
Date Completed: 10-28-25 Fiscal Analyst: Bobby Canell
David Zin
floor\sb423 Bill Analysis @ www.senate.michigan.gov/sfa
This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent.