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The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us) STATE OF MICHIGAN FRANK J. KELLEY, ATTORNEY GENERAL Opinion No. 6393 October 10, 1986 SCHOOLS AND SCHOOL DISTRICTS: Exemption from real property transfer tax TAXATION: Exemption of school districts from real property transfer tax School districts are exempt from the tax imposed upon written instruments transferring any interest in real property. Honorable Rudy Nichols State Senator The Capitol Lansing, Michigan You have inquired whether school districts are exempt from the tax imposed upon written instruments transferring any interest in real property by MCL 207.501 et seq; MSA 7.456(1) et seq. MCL 207.505(h); MSA 7.456(5)(h), as added by 1968 PA 327, provided: "The following instruments and transfers shall be exempt from this act: "(h) Instruments where the state, a county, a township, a city or a school district is the seller or grantor." As last amended by 1969 PA 67, MCL 207.505(h); MSA 7.456(5)(h), currently provides: "The following instruments and transfers shall be exempt from this act: "(h) Instruments (i) in which the grantor is the United States, the state, any political subdivision or municipality thereof, or officer thereof acting in his official capacity; ...." The substitution of the general terms political subdivision or municipality for the specific terms county, township, city or school district manifests a legislative intent to broaden rather than narrow the types of units of local government that are exempt from the real estate transfer tax. Further, there is amply judicial precedent that school districts are considered state agencies, political subdivisions, or municipal corporations for a variety of purposes. Presque Isle Twp School Dist No 8 v. Presque Isle County Board of Education, 364 Mich 605; 111 NW2d 853 (1961); Bowie v Coloma School Board, 58 Mich App 233, 236-239; 227 NW2d 298 (1975); School District No 4 of the Twp of Marathon v Gage, 39 Mich 484 (1878); Attorney General, ex rel McRae v Thompson, 168 Mich 511, 520; 134 NW 722 (1912); Hall v Ira Twp, 348 Mich 402, 405; 83 NW2d 443 (1957). Under each alternative designation, school districts are exempt from the tax by virtue of MCL 207.505(h); MSA 7.456(5)(h). You advise that the contention has been advanced by some that the decision in Board of Education of the School Dist of Detroit v Michigan Bell Telephone Co, 395 Mich 1, 4-5; 232 NW2d 633 (1975), supports the proposition that a school district is not a municipality and is, therefore, subject to the real estate transfer tax. The ruling in Board of Education of the School Dist of Detroit v Michigan Bell Telephone Co, stands only for the proposition that the Legislature did not include school districts within the definition of "municipality" for purposes of the plat act. It is my opinion, therefore, that school districts are exempt from paying the real estate transfer tax imposed by MCL 27.501 et seq; MSA 7.456(1) et seq. Frank J. Kelley Attorney General
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