                           STATE OF MICHIGAN

                            COURT OF APPEALS



CITY OF STERLING HEIGHTS,                                           FOR PUBLICATION
                                                                    March 19, 2015
                Petitioner-Appellee,

v                                                                   No. 317310
                                                                    Macomb Circuit Court
CHRYSLER GROUP, L.L.C.,                                             LC No. 2013-000125-AA

                Respondent-Appellant,

and

MICHIGAN STATE TAX COMMISSION,

                Respondent.


Before: BOONSTRA, P.J., and SAWYER and O’CONNELL, JJ.

BOONSTRA, J. (concurring).

       I respectfully concur in the result reached by the majority, as well as in much of its
reasoning. I specifically agree with the majority and the trial court that Chrysler Group, L.L.C.’s
applications for air pollution control tax exemption certificates should have been evaluated by
the Michigan Department of Environmental Quality (MDEQ), and that circuit court therefore
properly reversed the decision of the State Tax Commission (STC) to grant Chrysler’s
applications, and remanded to the MDEQ.

        I write separately to explain my somewhat differing reasoning, and to highlight certain
concerns. For example, I do not read the pertinent statutes as affording MDEQ or STC carte
blanche to “pre-approve” facilities based on the Memorandum of Understanding (MOU) that
those agencies entered into at the direction of the Legislature, pursuant to Section 311 of Part 2,
Article VII, of 2011 PA 631 (Section 311), purportedly in the interests of “streamlining” the
process for evaluating applications for pollution control tax exemptions. The MOU indeed
purports to require MDEQ to “[a]nnually, by June 1, review and submit to the STC the pollution
control equipment list commonly approved by the MDEQ for pollution control tax exemptions,”


1
    2011 PA 63 was an omnibus appropriations bill.


                                                -1-
and to “[w]hen requested by the STC, assist in the review of a limited number of applications
where the equipment is not identified on the annual pollution control equipment list approved by
the MDEQ.” Further, the MOU purports to require STC to “[a]nnually by July 1, approve a list
of air … pollution control equipment determined to be commonly approvable for pollution
control tax exemptions by the MDEQ.”

         However, Section 311—pursuant to which the MOU was adopted—provides in its
totality as follows:

               Sec. 311. The [MDEQ] shall enter into a memorandum of understanding
       with the department of treasury to develop a process for the review and approval
       of tax exemption certificates in accordance with the list of commonly approved
       air pollution control equipment adopted by the state tax commission on August 16,
       2010, and the list of commonly approved water pollution equipment adopted by
       the state tax commission on August 16, 2010. [2011 PA 63, art VII, part 2, § 311
       (emphasis added).]

         I first note (as a portion of the above italicized language reflects) that Section 311 refers
to a specific list in the past tense, i.e., one that was “adopted by the [STC] on August 16, 2010.”
Nowhere in that statutory language does the Legislature authorize or direct MDEQ or STC to
take it upon themselves to create future lists2 that arguably may then be deemed to constitute pre-
approved equipment regardless of the particular factual circumstances.

       Second, Section 311 requires MDEQ to enter into an MOU “to develop a process for the
review and approval of tax exemption certificates” (emphasis added) in accordance with the
referenced list. I am unable to read that language as clearly authorizing MDEQ and STC to
preapprove equipment for tax exemption without undergoing the otherwise-required statutory
evaluation in the particular circumstances presented.

        Third, Section 311 refers to the entry into an MOU concerning “commonly approved air
pollution control equipment” (emphasis added). I am aware of no definition of the term
“equipment” that would make it synonymous with the term “facility,” as defined in
MCL 324.5901. To the contrary, MCL 324.5901 defines “facility” to mean “machinery,
equipment, structures, or any part or accessories of machinery, equipment, or structures,” under
certain conditions. The Legislature’s use of different terms (“equipment” and “facility”) in the
two statutory provisions and its inclusion within the statutory definition of “facility” (as reflected
in MCL 324.5901) of items other than “equipment,” i.e., “machinery,” “structures,” and “any
part or accessories” of such “machinery” or “structures,” demonstrates to me that the Legislature
understood the meaning of “equipment” and “facility” to be different, and that the inclusion of
the term “equipment” within the definition of “facility” reflects that “equipment” necessarily has
a narrower definition than does the overall definition of “facility.” See United States Fidelity Ins
& Guaranty Co v Mich Catastrophic Claims Ass'n (On Rehearing), 484 Mich 1, 13; 795 NW2d


2
 The list provided by the parties on appeal indicates that it was approved by the STC on June 12,
2012.


                                                 -2-
101 (2009). Consequently, I do not read Section 311, in any event, as directing MDEQ to enter
into an MOU relating to “facilities,” as defined in MCL 324.5901, but rather as meaning what it
says, i.e., an MOU that relates to certain “equipment.” 3

        Ultimately, these observations lead me to the same outcome as the majority: the “list” in
question is not appropriately used in this case to effect a preapproval of the purported facilities
that are the subject of Chrysler’s applications.

        Further, I find inadequate record evidence that those purported facilities either meet the
statutory definition of “facility,” in that they were “installed or acquired for the primary purpose
of controlling or disposing of air pollution that if released would render the air harmful or
inimical to the public health or to property within this state,” MCL 324.5901 (emphasis added),
or that they were “designed and operated primarily for the control, capture, and removal of
pollutants from the air, and is suitable, reasonably adequate, and meets the intent and purposes of
[MCL 324.5501 et seq] and rules promulgated under that part,” MCL 324.5903 (emphasis
added).4

        I fully appreciate that there may be a value in “streamlining” processes, and that
budgetary restraints may provide added incentive for such streamlining. However, those factors
do not excuse agency noncompliance with statutory requirements. The trial court thus properly
remanded this matter to the MDEQ for a proper evaluation of whether the statutory requirements
of MCL 324.5901 and MCL 324.5903 are met, absent which it would not be appropriate for STC
to grant the sought-after air pollution control tax exemption certificates.

                                                              /s/ Mark T. Boonstra




3
  Neither 2011 PA 63 nor the Natural Resources and Environmental Protection Act (NREPA),
MCL 324.101 et seq., provides a definition of “equipment,” nor has our caselaw defined the term
in this context. In such situations, this Court may consult a dictionary to aid in its interpretation.
See Johnson v Pastoriza, 491 Mich 417, 436; 818 NW2d 279 (2012). The Merriam-Webster
Online Dictionary defines “equipment” as “the set of articles or resources serving to equip a
person or thing: as (1): the implements used in an operation or activity . . . (2): all the fixed
assets other than land and buildings of a business enterprise (3): the rolling stock of a railway.”
See www.merriam-webster.com/dictionary/equipment (last accessed March 6, 2015) (emphasis
added). “Equipment” would thus seem not to include a building or structure, or a portion
thereof, that nonetheless may constitute a “facility.”
4
  Without the requisite MDEQ findings under MCL 324.5903, for example, I am unable to
conclude from the current record (as apparently the majority does) that “Chrysler seeks
exemption for equipment and parts of structures that either directly contribute to removing
pollution from the air or that house equipment that does so” or that “this is not a case in which
Chrysler seeks an exemption certificate for a structure that is only indirectly responsible for
removing pollution from the air.”


                                                 -3-
