FAQ: What to know about Michigan’s pollution exemption law

March 19, 2026

Over the past decade, Michigan municipalities have granted more than $1 billion in tax exemptions to industrial companies for installing pollution control equipment, yet many recipients have repeatedly violated environmental regulations. The State Tax Commission issues these certificates after reviewing recommendations from state agencies, exempting companies from paying property taxes on pollution mitigation equipment, but oversight agencies admit they lack the resources to monitor whether companies maintain compliance. Despite provisions allowing certificate revocation for noncompliance, no exemptions have ever been canceled even when companies violate air quality laws and sign enforcement agreements with the state.

Who is affected

Michigan municipalities losing tax revenue (specifically Detroit lost $46 million over 10 years)
Detroit residents and taxpayers
Public services: county government, libraries, Detroit Zoo, Detroit Institute of Arts, and other public infrastructure
Five companies in Detroit: FCA US LLC (Stellantis), Marathon Petroleum Corporation, Global Titanium Inc., MPLX Terminals LLC, and Detroit Refining Logistics LLC
Salem Township in Washtenaw County (most recent exemption recipient)
Emerald RNG, LLC (received certificate in December)

What action is being taken

The State Tax Commission is issuing exemption certificates after review and recommendation from the Property Services Division and EGLE
EGLE is reviewing exemption requests and assessing which equipment qualifies
The exemption program continues to operate (most recent certificate issued in December to Emerald RNG, LLC)
When facilities are fined for air quality violations, fines go to the state's general fund

Why it matters

This program represents a significant loss of local tax revenue that could fund essential public services while failing to ensure environmental compliance. The lack of oversight capacity at EGLE and the State Tax Commission's reliance on EGLE creates a system where companies receive substantial tax breaks without accountability, even when they repeatedly violate air quality laws. The absence of certificate revocations despite dozens of violations undermines the program's stated purpose of incentivizing pollution control, and municipalities cannot properly assess the financial impact because there's no mandatory reporting requirement for these exemptions in annual financial statements.

What's next

No explicit next steps stated in the article

Read full article from source: bridgedetroit.com