Property: conveyance of state property; transfer of certain state-owned property in Detroit; provide for, the official text

Act
No. 6

Public
Acts of 2025

Approved
by the Governor

June
27, 2025

Filed
with the Secretary of State

June
27, 2025

EFFECTIVE
DATE:  June 27, 2025

state of michigan

103rd Legislature

Regular session of 2025

Introduced by Rep. Farhat

ENROLLED HOUSE BILL No. 4090

AN ACT to authorize the state
administrative board to convey state-owned property in Wayne County; to prescribe
conditions for the conveyance; to provide for powers and duties of state
departments, agencies, and officers regarding the property; and to provide for
disposition of revenue derived from the conveyance.

The People of the State of
Michigan enact:

Sec. 1. As used in this act:

(a) “Fair market value”
means the highest estimated price that the property will bring if offered for
sale on the open market, allowing a reasonable time to find a purchaser who
would buy with knowledge of the property’s possible uses.

(b) “Net revenue” means
the proceeds from the sale of the property less reimbursement for any costs to
the department of technology, management, and budget associated with the sale,
including, but not limited to, administrative costs, including employee wages,
salaries, and benefits; costs of reports and studies and other materials
necessary to the preparation of sale; environmental remediation; legal fees;
and any litigation costs related to the conveyance.

(c) “Public use” means,
subject to subdivision (d), actual use of the property by members of the public
or actual use by the unit of local government for any of the following:

(i) General government administration.

(ii) Publicly owned and operated correctional
facilities.

(iii) Law enforcement purposes.

(iv) Emergency management response purposes.

(v) Public educational use.

(vi) Public transportation.

(vii) Public parks and recreational areas.

(viii) Public health uses.

(ix) Wildlife conservation or restoration.

(d) Public use does not include
use by a for-profit enterprise or any use that is closed to the public.

(e) “Unit of local
government” means a township, village, city, county, school district,
intermediate school district, or community college district.

Sec. 2. (1) The state administrative board, on
behalf of this state, may convey by quitclaim deed in accordance with this act
all or portions of real property described in subsection (2) that is owned by
this state, that is under the jurisdiction of the department of corrections,
and that was formerly the site of the Mound and Ryan Correctional
Facilities in the City of Detroit in Wayne County.

(2) The real property
that may be conveyed under this act is described as follows:

A
Parcel of Land situated in the City of Detroit, County of Wayne, State of
Michigan, and described as follows to wit: Commencing at the East One-quarter
corner of Section 8, Town 1 South, Range 12 East, City of Detroit, County of
Wayne, State of Michigan; thence S00°09’59”E, along the East line of said
Section 8, 339.20 feet; thence N89°37’40”W 33.00 feet to the Westerly
right-of-way line of Mound Road and the point of beginning; thence S00°09’59”E,
along said Westerly right-of-way line of Mound Road, 1019.85 feet to the
Northerly right-of-way line of the Detroit Terminal Railroad; thence along said
Northerly railroad right-of-way line for the following ten (10) courses:
N63°31’31”W 155.37 feet; thence 244.55 feet along a curve to the left whose
radius is 805.05 feet, and chord bearing and distance are N72°13’39”W 243.61
feet; thence N80°55’48”W 361.00 feet; thence 142.03 feet along a curve to the
left whose radius is 913.13 feet, and curve bearing and distance are N85°23’10”W
141.89 feet; thence N89°50’31”W 1689.10 feet to the North and South One-quarter
line of said Section, as monumented; thence continuing N89°50’31”W 158.96 feet;
thence 63.55 feet along a curve to the left whose radius is 407.72 feet, and
chord bearing and distance are S85°41’34”W 63.49 feet; thence S81°13’39”W
447.44 feet; thence 81.99 feet along a curve to the right whose radius is
526.04 feet, and chord bearing and distance are S85°41’34”W 81.91 feet; thence
N89°50’31”W 1840.16 feet to the Easterly line of Ryan Avenue; thence, along the
Easterly line of Ryan Avenue, N00°54’12”E 913.70 feet; thence N89°44’40”E
1288.52 feet; thence S00°26’31”W 10.59 feet; thence S89°35’47”E 9.94 feet;
thence S00°50’23”W 17.74 feet; thence N88°56’46”E 100.58 feet; thence S60°38’37”E
197.07 feet; thence S67°20’46”E 100.71 feet; thence S89°00’42”E 133.93 feet;
thence S89°55’05”E 363.54 feet; thence S89°26’23”E 518.31 feet; thence N00°03’16”W
446.28 feet to the Southerly right-of-way line of Nevada Avenue; thence S89°36’36”E,
along said Southerly right-of-way line of Nevada Avenue, 100.19 feet to the
East Line of the Detroit Police Department Property; thence, along the said
Detroit Police Department Property line the next following (3) courses: S00°03’16”E
621.57 feet and S89°50’16”E 440.00 feet and N00°03’16”W 619.82 feet to the
Southerly right-of-way line of Nevada Avenue; thence S89°36’36”E 299.93 feet;
thence S00°06’42”E 435.24 feet; thence S89°31’49”E 256.51 feet; thence S89°31’50”E
375.10 feet; thence N00°03’16”W 133.61 feet; thence S89°37’40”E 975.93 feet to
the point of beginning.

Parcel
contains 96.14 acres of land, more or less.

(3) The description of
the property in subsection (2) is approximate and, for purposes of a conveyance
under this act, may be adjusted as the state administrative board or the
department of attorney general considers necessary because of a survey or another
legal description.

Sec. 3. The
director of the department of technology, management, and budget shall first
offer the property described in section 2 to the City
of Detroit, which will have the first right to purchase the property for
2 years after the effective date of this act. The
City of Detroit may acquire the property for $1.00 or, if approved by
the director of the department of technology, management, and budget, any
portion of the property for $1.00. Conveyance of the property or any portion of
the property for $1.00 is subject to the conditions prescribed in section 5.

Sec. 4. (1) Except as provided in section 3,
the department of technology, management, and budget may take the necessary
steps for the conveyance of the real property described in section 2 using any
of the following means:

(a) Competitive bidding,
designed to realize the best value to this state, as determined by the
department of technology, management, and budget.

(b) A public auction
designed to realize the best value to this state, as determined by the
department of technology, management, and budget.

(c) The use of real
estate brokerage services designed to realize the best value to this state, as
determined by the department of technology, management, and budget.

(d) A value for value
conveyance negotiated by the department of technology, management, and budget
designed to realize the best value to this state. In determining whether value
for value consideration for the property represents the best value, the department
of technology, management, and budget may consider the fair market value, or
the total value based on any positive economic impact to this state likely to
be generated by the proposed use of the property, especially economic impact
resulting in the creation of jobs or increased capital investment in this
state.

(e) Offering the property
for sale for fair market value to 1 or more units of local government in which
the property is located.

(f) Offering the property
for sale for less than fair market value to the units of local government in
which the property is located.

(g) Conveying the
property to a land bank authority created under the land bank fast track act,
2003 PA 258, MCL 124.751 to 124.774.

(2) If real property is
to be sold for fair market value under this section, the fair market value must
be determined by a fee appraisal prepared for the department of technology,
management, and budget by an independent appraiser.

Sec. 5. A sale to a unit
of local government under section 3 or 4(1)(f) must be subject to all of the
following conditions:

(a) The property must be
used exclusively for public use. If a fee, term, or condition is imposed on
members of the public for use of the property, or if the fee, term, or
condition for use is waived, all members of the public must be subject to the
same fees, terms, conditions, and waivers. The public use restriction must be
included in the deed.

(b) If the unit of local
government intends to convey the property, the unit must provide notice to the
department of technology, management, and budget of its intent to offer the
property for sale. The department of technology, management, and budget retains
a right to first purchase the property at the original sale price within 1 year
after the notice. If this state waives its first refusal right, the unit of
local government must pay to this state 100% of the difference between the sale
price of the conveyance from this state and the sale price of the unit of local
government’s subsequent sale or sales to third parties.

(c) The unit of local
government must reimburse this state at closing for costs demonstrably incurred
by this state that were necessary to prepare the property for conveyance.

(d)
The department of technology, management, and budget may require the unit of
local government to record the deed of conveyance with the office of register
of deeds for the county in which the property is located at the unit of local
government’s expense.

Sec. 6. (1) A deed authorized by this act must
be approved as to legal form by the department of attorney general.

(2) Real property
conveyed under this act includes all surplus, salvage, and scrap property or
equipment remaining on the property on the date of the conveyance.

(3) This state shall not
reserve oil, gas, or mineral rights to property conveyed under this act.
However, the conveyance authorized under this act must provide that, if the
grantee or any successor develops any oil, gas, or minerals found on, within,
or under the conveyed property, the grantee or any successor must pay this
state 1/2 of the gross revenue generated from the development of the oil,
gas, or minerals. A payment under this subsection must be deposited in the
general fund.

(4) A conveyance under
this act must reserve to this state all aboriginal antiquities, including
mounds, earthworks, forts, burial and village sites, mines, or other relics
lying on, within, or under the property, with power to this state and all
others acting under its authority to enter the property for any purpose related
to exploring, excavating, and taking away the aboriginal antiquities.

(5) If property conveyed
under this act is used in a manner that violates any of the restrictions
imposed under section 5 or subsection (3) or (4), this state may reenter and
take the property, terminating the grantee’s or any successor’s estate in the
property.

(6) If a grantee or
successor disputes this state’s exercise of its right of reentry under
subsection (5) and fails to promptly deliver possession of the property to this
state, the attorney general, on behalf of this state, may bring an action to
quiet title to, and regain possession of, the property.

(7) If this state
reenters and repossesses property under subsection (5) or (6), this state is
not liable to reimburse any person for any improvements made on the property.

Sec. 7. The
state administrative board shall deposit the net revenue received from the sale
of property under this section in the state treasury. The state treasurer shall
credit the money deposited to the general fund.

This
act is ordered to take immediate effect.

Clerk of the House of
Representatives

Secretary of the Senate

Approved___________________________________________

____________________________________________________

Governor