|
"A land patent is '[a]n instrument by which the government conveys a grant of public land to a private person.' " - Glass v. Goeckel, 473 Mich. 667 fn. 11, 703 N.W.2d 58 (2005).
Thus, the government owns the land. The government then conveys the property to someone. When they do, that property becomes part of the mass of property in the State.
"Where federal land is sold to a private person, it becomes part of the general mass of property in the state and is subject to ad valorem property taxation. [cite omitted] Thus, the land in this case ceased to be federal land and was subject to taxation when the unrestricted patent was issued [to the grantee]." - Bay Mills Indian Community v. State, 244 Mich. App. 739, 626 N.W.2d 169 (Mich. App., 2001).
Property owned by the federal government is generally not subject to taxation by the State. This has to do with intergovernmental immunity doctrine - the idea that one government cannot tax the other.
The federal government can sort of "pass on" this tax exemption in the way it grants the land.
One of the easiest examples is a conveyance to an Indian tribe. In that case, the conveyance is not to citizens of the State, but to what is essentially a foreign people (in a sense). That property is not really part of the State (in a way), or at least it can be thought of as not under State control, although within the boundaries of the State. Now although the State might not tax that property, that certainly doesn't mean that the property is not subject to *any* property tax ... for the Indians control the land and may subject it to their own taxes.
In the case of a grant to a citizen of the State, as the quote above notes, that property belongs to someone within the jurisdiction of the State ... and both the land and citizen are within the jurisdiction of the State ... and thus the State can proceed to tax that property.
Tax protestors have it exactly backwards. The property was exempt from State taxation while in the hands of the federal government (because of intergovernmental immunity) ... and once an unconditional land patent is issued, the property comes within the control of the State ... and is subject to tax.
Of course, there is far more that could be said, but I don't have time to write a book.
|