Energy committee adopts substitutes for nuclear tax-credit bills; local-property amendment fails

Lansing — The House Energy, Communications, and Technology Committee on Tuesday adopted substitute language and reported a package of bills (HB4124–HB4129) that would expand research-and-development and production tax credits to the full nuclear industry, including small modular reactors (SMRs).

Chair Wenzel told the committee: “We're gonna get started this morning by voting out the nuclear package, HB 4,124 through 4,129, that we heard testimony on a few weeks back at our last meeting.” The committee adopted substitute language and then voted to report the bills to the next stage.

The bills, as described during debate, would broaden the R&D tax credit to cover the entire nuclear sector (from SMRs to investments at existing plants) and extend production tax-credit eligibility through 2040 so more firms can qualify. Committee members said the intent was to position Michigan to participate in “next-generation” nuclear technology and related investment.

Representative Valerie Bridal offered an amendment to HB4128 intended to protect local tax bases by requiring SMRs to be classified as real property and to be valued using generally accepted appraisal principles, including consideration of highest and best use. Bridal said local school districts had been harmed by appeals in the past and that Bridgeman Public Schools “is still experiencing a revenue loss of 12% with a $1,200,000 annual deficit.” The amendment was not adopted.

Committee action moved the bills forward by roll call votes. Members who opposed reporting HB4124 identified specific concerns about local impacts; other members argued the package supports industry investment and state competitiveness. The committee chair said the package and its substitutes will proceed to the next steps of the legislative process.

Votes at a glance

- HB4124: Substitute H-1 adopted (15–0). Motion to report with recommendation as substitute passed (13–2; recorded nays: Representative Valerie Bridal, Representative Myers Phillips). - HB4125: Referred to the Committee on Rules (15–0). - HB4126: Reported with recommendation (15–0). - HB4127: Reported with recommendation (15–0). - HB4128: Substitute H-2 adopted (15–0). Amendment offered by Representative Bridal to require SMRs be classified as real property and appraised using generally accepted appraisal principles failed (5–10). HB4128 reported with recommendation as substitute H-2 (12–2). - HB4129: Referred to the Committee on Rules (15–0).

What the amendment would have done

Representative Bridal said the amendment would require that SMRs qualify for tax credits only if they are classified as real property and valued using generally accepted appraisal principles, including highest-and-best-use analysis, to prevent a shift of local tax burden. Supporters of the amendment pointed to a Bridgeman school district settlement that had reduced a larger appeal to an ongoing 12% revenue shortfall; supporters said the amendment would protect local revenue streams. Opponents argued the bill package as a whole must remain broadly structured to attract private investment and that the amendment would unduly limit the tax-credit structure.

Next steps

With substitutes adopted and motions prevailing, the bills will move forward in the House legislative process. Committee members and staff noted additional negotiations on final dollar amounts and statutory language are likely as the bills proceed.