Michigan self storage facilities barely avoiding being subjected to a sales tax in December 2007, when Michigan’s legislature passed a six percent service sales tax and then repealed the tax only a few hours after it went into effect. Instead Michigan legislators decided to add a 21.99 percent surcharge to the state’s new business tax.

But now Michigan’s self storage industry faces the likelihood that the legislature will pass the service sales tax again. Michigan is projecting that in its upcoming fiscal year, starting in October, the state will have a $1.7 billion budget deficit. Governor Jennifer Granholm wants to reinstate the service sales tax to help make up the difference. She told the Michigan Public Radio Network this week that legislators, most of whom are up for reelection in November, would be better off agreeing to a service sales tax now than taking the risk of having to shut down the government for lack of money, a month before the general election. In October 2007, Michigan’s government had to partially shut down for four hours. [More]

Michigan's Governor, Jennifer Granholm, proposed yesterday that Michigan's sales tax be extended to cover consumer services, including self-storage. Granholm hopes to see the sales tax reduced from six percent to 5.5 percent. The change would raise another $550 million in revenue for the state of Michigan. Under Granholm's plan, the money would be used to help pay for public education, making it possible for Michigan schools to maintain their current level of spending. Michigan's Senate Fiscal Agency, which is a nonpartisan organization, previously announced that Michigan's school aid budget will have a $423 million deficit if more money is not raised. Michigan's general fund, likewise, will have a $1.2 billion deficit. Over the last two years, Michigan's general fund has dropped by $2 billion.

This is not the first time Michigan has considered extending its sales tax. A similar attempt was made two years ago, but was defeated as a result of lobbying and advocacy by the national Self Storage Association and the Self Storage Association of Michigan (SSAM). [More]

Michigan's legislature has passed Senate Bill 204, amending the lien procedures for self-storage facilities in the state. The bill was sent to Michigan Governor Jennifer Granholm on December 7. When Granholm signs it, it will become law. The Self Storage Association of Michigan and the national Self Storage Association both lobbied on behalf of the bill, which sets special rules for self-storage tenants if they are deployed military personnel. The bill was originally introduced into the Michigan legislature by Democratic Senator Dennis Olshove on Feb. 10, 2009. The same language being used in the Michigan bill is also being considered in legislation that is pending in Arizona, California, and North Carolina.

As currently written, Michigan's self-storage lien laws allow storage operator's to sell, at a public sale, the goods that they find inside a unit when the unit's rent is not paid. SB 204, which is being referred to as the "self-service storage facility act," makes deployed military personnel exempt from having their units foreclosed on, and the contents auctioned at a public sale, if they are unable to pay regular rent payments on the self-storage units they occupy. According to the new rules set forth in the bill, a self-storage facility owner cannot enforce a lien against a armed services member who is currently serving overseas on active duty and who will be on duty overseas for at least 180 days. When service members return from overseas assignments, self-storage facility owners must wait at least 90 days after the end of the overseas service before they can begin lien enforcement proceedings. [More]