-1- 

STATE OF MICHIGAN 

COURT OF APPEALS 

AK STEEL HOLDING CORPORATION, 

 Plaintiff-Appellant/Cross-Appellee, 

FOR PUBLICATION 

February 25, 2016 

9:00 a.m. 

v No. 327175 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 13-000180-MT 

 Defendant-Appellee/CrossAppellant. 

JOHNSON MATTHEY, INC., 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327251 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 11-000067-MT 

 Defendant-Appellee/CrossAppellant. 

EMCO ENTERPRISES, INC., 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327313 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000152-MT 

 Defendant-Appellee/CrossAppellant. 

CARGILL MEAT SOLUTIONS 

CORPORATION, 

 Plaintiff-Appellant/Cross-Appellee, 
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v No. 327314 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000110-MT 

 Defendant-Appellee/CrossAppellant. 

WATTS REGULATOR COMPANY, 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327315 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 13-000040-MT 

 Defendant-Appellee/CrossAppellant. 

SLBP HOLDINGS CORPORATION, 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327316 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 13-000003-MT 

 Defendant-Appellee/CrossAppellant. 

RENEWAL BY ANDERSON CORPORATION, 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327317 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 13-000002-MT 

 Defendant-Appellee/CrossAppellant. 

ANDERSON WINDOWS, INC., 
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 Plaintiff-Appellant/Cross-Appellee, 

v No. 327318 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000153-MT 

 Defendant-Appellee/CrossAppellant. 

SID TOOL COMPANY, INC., 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327319 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 13-000005-MT 

 Defendant-Appellee/CrossAppellant. 

MARTIN SPROCKET & GEAR, INC., 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327320 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000091-MT 

 Defendant-Appellee/CrossAppellant. 

UNITED STATIONERS SUPPLY COMPANY, 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327321 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000057-MT 

 Defendant-Appellee/CrossAppellant. 
-4- 

RODALE, INC., 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327322 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000048-MT 

 Defendant-Appellee/CrossAppellant. 

GOODYEAR TIRE & RUBBER COMPANY, 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327323 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000047-MT 

 Defendant-Appellee/CrossAppellant. 

LESLIE CONTROLS, INC., 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327324 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000055-MT 

 Defendant-Appellee/CrossAppellant. 

HOKE, INC., 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327325 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000054-MT 

 Defendant-Appellee/Cross- 
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Appellant. 

SPENCE ENGINEERING, INC., 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327326 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000052-MT 

 Defendant-Appellee/CrossAppellant. 

CIRCOR ENERGY PRODUCTS, INC., 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327327 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000053-MT 

 Defendant-Appellee/CrossAppellant. 

CIRCOR AEROSPACE, INC., 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327328 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000056-MT 

 Defendant-Appellee/CrossAppellant. 

GTECH CORPORATION, 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327329 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000050-MT 
-6- 

 Defendant-Appellee/CrossAppellant. 

CAMBREX CHARLES CITY, INC., 

 Plaintiff-Appellant, 

v No. 327330 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 13-000060-MT 

 Defendant-Appellee. 

CAMBREX CHARLES CITY, INC., 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327331 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 12-000044-MT 

 Defendant-Appellee/CrossAppellant. 

EMC CORPORATION, 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327333 

Court of Claims 

DEPARTMENT OF TREASURY, LC No. 13-000048-MT 

 Defendant-Appellee/CrossAppellant. 

EMC CORPORATION, 

 Plaintiff-Appellant/Cross-Appellee, 

v No. 327334 

Court of Claims 
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DEPARTMENT OF TREASURY, LC No. 12-000040-MT 

 Defendant-Appellee/CrossAppellant. 

Before: RIORDAN, P.J., and JANSEN and HOOD, JJ. 

PER CURIAM. 

I. INTRODUCTION 

 In these 23 consolidated appeals,1 the plaintiffs are taxpayers who respectively appeal as 

of right orders granting summary disposition in each case to defendant, the Michigan Department 

of Treasury. Each appeal raises common issues challenging the Court of Claims’ holding that 

the mandatory apportionment provision of the Single Business Tax Act (“SBTA”), MCL 208.1 

et seq.,2

 impliedly repealed a provision of Michigan’s enactment of the Multistate Tax Compact 

(“the Compact”), MCL 205.581 et seq.,3

 which allowed multistate taxpayers to apportion their 

tax base using an equally weighted, three-factor formula set forth in the Compact. Plaintiffs 

further contend that an implied repeal of the Compact’s election provision violates the terms of 

the Compact—which, according to plaintiffs, was binding on subsequent legislatures—and 

violates state and federal constitutional provisions. Additionally, in Docket No. 327251, plaintiff 

Johnson Matthey, Inc. (“Johnson Matthey”) also argues that it was entitled to apportion its 

Michigan Business Tax (“MBT”) base pursuant to the Compact apportionment formula, and that 

the retroactive repeal of the Compact by 2014 PA 282 violated the terms of the Compact and 

various constitutional provisions. 

In cross-appeals in all of the cases except for Cambrex Charles City, Inc v Dep’t of 

Treasury (Docket No. 327330), and as alternative grounds for affirmance in all of the cases, 

defendant argues that the SBT is not an income tax under the apportionment election provision 

of the Compact and that the retroactive repeal of the Compact by 2014 PA 282 barred plaintiffs 

from asserting their respective SBT refund claims. 

Because we conclude that the SBTA did not impliedly repeal the Compact apportionment 

election provision, we reverse and remand for further proceedings consistent with this opinion. 

 

1 AK Steel Holding Corp v Dep’t of Treasury, unpublished order of the Court of Appeals, entered 

November 24, 2015 (Docket Nos. 327175 et al). 

2

 The entire SBTA was repealed by 2006 PA 325 and replaced with the Michigan Business Tax 

Act (“MBTA”). All subsequent references to the SBTA, MCL 208.1 et seq., shall incorporate 

this repeal. 

3

 The Compact was expressly and retroactively repealed by 2014 PA 282, effective beginning 

January 1, 2008. All subsequent to the Compact should similarly incorporate this later explicit 

repeal. 
-8- 

II. HISTORICAL BACKGROUND AND PROCEDURAL POSTURE4

 Plaintiffs in the present cases are claiming SBT refunds for at least one tax year between 

2005 and 2007. In particular, plaintiffs seek to reduce their SBT liability for the tax years at 

issue by apportioning their income through the equally weighted, three-factor apportionment 

formula provided in the Compact rather than the three-factor formula provided in the SBTA, 

which weighted the sales factor of the formula more heavily. As the Court of Claims stated, the 

principal issue in these cases is “whether the SBT apportionment formula for the tax years in 

question is mandatory or whether an SBT taxpayer may elect to apportion its tax base to 

Michigan using the Compact’s equally weighted, three-factor apportionment formula.” 

A. THE SBTA 

 From January 1, 1976, until its repeal effective December 31, 2007, the SBTA governed 

the taxation of business activity in Michigan. See 1975 PA 228; 2006 PA 325. Under the 

SBTA, a tax base was calculated by beginning with a business’s federal taxable income and then 

adding back compensation, depreciation, and other factors, as well as making other adjustments. 

See Trinova Corp v Mich Dep’t of Treasury, 498 US 358, 366-367; 111 S Ct 818; 112 L Ed 2d 

884 (1991) (Trinova II). Throughout its history, the SBT was apportioned using a three-factor 

formula consisting of payroll, property, and sales. As the Court of Claims explained in its 

opinion, this formula originally weighted the three factors equally, in accordance with previous 

business taxes in Michigan and the nearly universal practice of other states at the time. 

However, in later years, many states moved away from an equally weighted, three-factor formula 

by more heavily weighting the sales factor. Following this trend, the Michigan Legislature 

abandoned uniform apportionment and began to more heavily weight the sales factor in 1991. 

See 1991 PA 77. Subsequent amendments continued to weigh the sales factor even more 

heavily. For tax years 1999 through 2005, the sales factor was weighted at 90%, and for 2006 

and 2007, the sales factor was weighted at 92.5%. See 1995 PA 283; 2005 PA 295; MCL 

208.45a(1)(c), (2)(c), repealed by 2006 PA 325. 

B. THE COMPACT 

The Compact originally was adopted by seven states in 1967. The Michigan Legislature 

adopted the Compact provisions effective in 1970. See 1969 PA 343. While Congress never 

approved the Compact, it was upheld against constitutional challenges. See US Steel Corp v 

Multistate Tax Comm, 434 US 452; 98 S Ct 799; 54 L Ed 2d 682 (1978). The Compact 

established the Multistate Tax Commission (“the Commission”), but each state remained free to 

adopt or reject the Commission’s rules and regulations and remained free to withdraw from the 

Compact at any time. See id. at 473. Most relevant to this appeal, Article IV of the Compact set 

forth a three-factor apportionment formula that equally weighted property, payroll, and sales 

factors. MCL 205.581, Art IV(9). Article III of the Compact provided that a taxpayer subject to 

 

4

 In summarizing the historical development of the law in Michigan, we rely heavily on the 

Court of Claims’ comprehensive and well-written recitation of the relevant legal background in 

its opinion issued in EMCO Enterprises, Inc v Dep’t of Treasury (Docket No. 327313). 
-9- 

an income tax “in two or more party states may elect to apportion and allocate his income in the 

manner provided by the laws of such states . . . without reference to this compact, or may elect to 

apportion and allocate in accordance with article IV.” MCL 205.581, Art III(1). 

On May 25, 2011, the Michigan Legislature passed 2011 PA 40, which amended the 

Compact so that a multistate taxpayer subject to the MBTA or the income tax act of 1967 could 

not elect the Compact apportionment formula beginning January 1, 2011. Then, on September 

11, 2014, our Legislature enacted 2014 PA 282, which retroactively repealed the Compact 

provisions effective January 1, 2008, and mandated the use of a single sales-factor 

apportionment formula for the purpose of calculating the MBT and the corporate income tax. As 

the Court of Claims explained in EMCO: 

 PA 282 thus amended the MBT to express the “original intent” of the 

Legislature with regard to (1) the repeal of the Compact provisions, (2) 

application of the MBT’s apportionment provision under MCL 208.1301, and (3) 

the intended effect of the Compact’s election provision under MCL 205.581. The 

effect of the amendments, as written, retroactively eliminates a taxpayer’s ability 

to elect a three-factor apportionment formula in calculating tax liability under 

both the MBT and the [corporate income tax]. 

C. THE COURT OF CLAIMS’ DECISION 

In one of the present appeals, EMCO Enterprises, Inc v Dep’t of Treasury (Docket No. 

327313) (“EMCO”), the Court of Claims issued a 29-page opinion addressing the plaintiff’s 

claims and granting summary disposition in favor of defendant pursuant to MCR 2.116(I)(2). In 

summarizing its decision, the Court of Claims stated: 

 The Court, in fulfilling its duty to ascertain and apply the intent of the 

Legislature, finds that the taxpayer is required to use the apportionment formulas 

mandated under the SBTA for the tax years in question, and is not entitled to elect 

a different apportionment formula under the Compact. Though the SBT is an 

income tax within the meaning of the Compact, future legislatures were not bound 

by the policies of the legislature that enacted 1969 PA 343. The purpose of state 

tax uniformity as embedded in both the Compact’s apportionment elective 

provision by the 1969 legislature, and the SBTA’s equally weighted, three-factor 

apportionment formula as originally enacted by the 1975 legislature, is not 

consistent with the purpose of later amendments made to apportionment formulas 

by the Legislature. Under traditional rules of statutory construction, the 

apportionment formula under the SBTA for the tax years in question must control. 

More specifically, in its EMCO opinion, the Court of Claims concluded that the Compact was 

advisory and did not bind future legislatures, that the Compact was not a binding contract under 

Michigan law, and that the Legislature was therefore free to mandate the use of apportionment 

formulas that deviated from the formula set forth in the Compact. The court further determined 

that the SBTA in effect during the tax years at issue conflicted with the Compact apportionment 

election provision by requiring the use of a different apportionment formula from that provided 

in the Compact, and that these provisions could not be harmonized. Thus, the Court of Claims 
-10- 

concluded that the SBTA apportionment provision was controlling and had impliedly repealed 

the Compact’s apportionment election provision. Further, the court rejected arguments that 

denying plaintiffs the right to elect the Compact’s equally weighted, three-factor apportionment 

formula violated the Commerce and Due Process Clauses of the United States Constitution. 

In the remaining appeals, the Court of Claims entered essentially identical orders in each 

case granting summary disposition in favor of defendant pursuant to MCR 2.116(I)(1) on the 

basis of the reasoning in the EMCO opinion.5

III. STANDARD OF REVIEW 

 A trial court’s decision to grant summary disposition pursuant to MCR 2.116(I)(1) is 

reviewed de novo. Gillette Commercial Operations North America & Subsidiaries v Dep’t of 

Treasury, ___ Mich App ___, ___; ___ NW2d ___ (2015) (Docket Nos. 325258 et al); slip op at 

16, lv pending (“Gillette”). MCR 2.116(I)(1) provides, “If the pleadings show that a party is 

entitled to judgment as a matter of law, or if the affidavits or other proofs show that there is no 

genuine issue of material fact, the court shall render judgment without delay.”6 We also review 

de novo issues involving statutory interpretation as well as constitutional questions. Gillette, ___ 

Mich App at ___; slip op at 16. 

IV. IMPLIED REPEAL OF THE COMPACT ELECTION PROVISION 

 The central issue in this case is whether the Court of Claims erred in concluding that the 

SBTA’s mandatory apportionment provision impliedly repealed the Compact’s apportionment 

election provision for the tax years at issue (i.e., 2005, 2006, and 2007). We agree with plaintiffs 

 

5

 In Johnson Matthey (Docket No. 327251), the Court of Claims’ order also included language 

referencing the Court of Claims’ opinions in two other cases holding that 2014 PA 282 negated 

the plaintiffs’ claims for refunds under the MBTA. The two cases were Yaskawa America, Inc v 

Dep’t of Treasury (Docket No. 325475), and Ingram Micro, Inc v Dep’t of Treasury (Docket No. 

325507), both of which were part of the 50 consolidated appeals that were the subject of this 

Court’s recent published opinion in Gillette Commercial Operations North America & 

Subsidiaries v Dep’t of Treasury, ___ Mich App ___; ___ NW2d ___ (2015) (Docket Nos. 

325258 et al), lv pending, which is discussed later in this opinion. 

6

 The Court of Claims’ opinion in EMCO stated that it was granting summary disposition to 

defendant pursuant to MCR 2.116(I)(2), which states: “If it appears to the court that the opposing 

party, rather than the moving party, is entitled to judgment, the court may render judgment in 

favor of the opposing party.” However, the orders in the other 22 consolidated cases stated that 

summary disposition was granted to defendant pursuant to MCR 2.116(I)(1). The issues raised 

in these cases concern questions of law. As such, whether defendant is entitled to summary 

disposition is a matter of law. Thus, we conclude that review under MCR 2.116(I)(1) is proper. 

It is well settled that regardless of the subrule cited by the trial court in granting summary 

disposition, this Court will review the court’s order under the correct subrule. See Spiek v Dep’t 

of Transp, 456 Mich 331, 338 n 9; 572 NW2d 201 (1998). 
-11- 

and hold that the SBTA did not impliedly repeal the Compact’s apportionment election 

provision. 

A. BACKGROUND LAW 

 “When interpreting statutory language, our obligation is to ascertain the legislative intent 

that may reasonably be inferred from the words expressed in the statute.” Koontz v Ameritech 

Servs, Inc, 466 Mich 304, 312; 645 NW2d 34 (2002). “Courts must give effect to every word, 

phrase, and clause in a statute, and must avoid an interpretation that would render any part of the 

statute surplusage or nugatory.” Id. Statutory language must be read in context, and undefined 

words are to be given their plain and ordinary meanings. MidAmerican Energy Co v Dep’t of 

Treasury, 308 Mich App 362, 370; 863 NW2d 387 (2014). “If the language of the statute is 

unambiguous, the Legislature must have intended the meaning clearly expressed, and the statute 

must be enforced as written.” Sun Valley Foods Co v Ward, 460 Mich 230, 236; 596 NW2d 119 

(1999). 

 In general, “repeals by implication are disfavored.” Wayne Co Prosecutor v Dep’t of 

Corrections, 451 Mich 569, 576; 548 NW2d 900 (1996). As such, it is generally presumed “that 

if the Legislature had intended to repeal a statute or statutory provision, it would have done so 

explicitly.” Id. When presented with a claim that two statutes conflict, a court must endeavor to 

construe the statutes harmoniously if possible. Id. 

[R]epeal by implication will not be found if any other reasonable construction 

may be given to the statutes, such as reading in pari materia two statutes that 

share a common purpose or subject, or as one law, even if the two statutes were 

enacted on different dates and contain no reference to one another. However, a 

repeal of a statute may be inferred in two instances: (1) where it is clear that a 

subsequent legislative act conflicts with a prior act; or (2) when a subsequent act 

of the Legislature clearly is intended to occupy the entire field covered by a prior 

enactment. [City of Kalamazoo v KTS Indus, Inc, 263 Mich App 23, 36-37; 687 

NW2d 319 (2004) (citations omitted; emphasis added).] 

 Similarly, the Michigan Supreme Court previously explained, “[I]f the provisions of a 

later statute are so at variance with those of an earlier act, or a part thereof, that both cannot be 

given effect[,] then the later enactment control[s] and there is a repeal by implication. In such a 

case it must be presumed that the legislature intended a repeal.” Jackson v Mich Corrections 

Comm, 313 Mich 352, 357; 21 NW2d 159 (1946). “Repeals by implication are not favored, but 

do happen, and, when clear, must be given effect.” Id. (quotation marks and citation omitted). 

Therefore, “if there is such repugnance that both [statutes] cannot operate, then the last 

expression of the legislative will must control.” Id. at 356. “[T]he latter act operates to the 

extent of the repugnancy, as a repeal of the first . . . .” Id. at 357 (quotation marks and citation 

omitted). See also Metro Life Ins Co v Stoll, 276 Mich 637, 641; 268 NW 763 (1936) (“It is the 

rule that where two laws in pari materia are in irreconcilable conflict, the one last enacted will 

control or be regarded as an exception to or qualification of the prior statute.”). Notably, “when 

faced with two statutes that bear on the same subject, our task is not to discern the most logical 

construction of the more recent statute, but to labor to permit the survival of both enactments if 
-12- 

possible.” House Speaker v State Admin Bd, 441 Mich 547, 571-572; 495 NW2d 539 (1993) 

(quotation marks and citation omitted). 

B. ANALYSIS 

During the tax years at issue in this case, § 41 of the SBTA provided that “[a] taxpayer 

whose business activities are taxable both within and without this state, shall apportion his tax 

base as provided in this chapter.” MCL 208.41 (emphasis added). As previously discussed, for 

tax years prior to 1991, the SBTA prescribed an equally weighted, three-factor apportionment 

formula comprised of property, payroll, and sales factors. Beginning with the 1991 tax year, 

however, the SBTA required the sales factor to be weighted more heavily than the other factors, 

and the weight of the sales factor was further increased in later tax years by legislative 

amendments to the act. See MCL 208.45; MCL 208.45a. For the 2005 tax year, the sales factor 

was weighted at 90%. MCL 208.45a(1)(c). For the 2006 and 2007 tax years, the sales factor 

was weighted at 92.5%. MCL 208.45a(2)(c). 

 To the contrary, during the tax years at issue, the Compact’s apportionment election 

provision stated: 

 (1) Any taxpayer subject to an income tax whose income is subject to 

apportionment and allocation for tax purposes pursuant to the laws of a party state 

or pursuant to the laws of subdivisions in 2 or more party states may elect to 

apportion and allocate his income in the manner provided by the laws of such 

state or by the laws of such states and subdivisions without reference to this 

compact, or may elect to apportion and allocate in accordance with Article IV . . . 

. [MCL 205.581, Art III(1).] 

As explained supra, article IV of the Compact set forth an equally weighted, three-factor 

apportionment formula comprised of property, payroll, and sales factors. MCL 205.581, Art 

IV(9). Thus, the Compact election “provision allow[ed] a taxpayer subject to an income tax to 

elect to use a party state’s apportionment formula or the Compact’s [equally weighted,] threefactor formula.” Int’l Business Machines Corp v Dep’t of Treasury, 496 Mich 642, 653; 852 

NW2d 865 (2014) (opinion by VIVIANO, J.) (“IBM”). 

 The Court of Claims correctly concluded that an apparent conflict exists between the 

language of the SBTA and the Compact election provision. Under § 41 of the SBTA, a 

multistate taxpayer “shall apportion his tax base as provided in this chapter.” MCL 208.41 

(emphasis added). “The Legislature’s use of the word ‘shall’ generally indicates a mandatory 

directive, not a discretionary act.” Smitter v Thornapple Twp, 494 Mich 121, 136; 833 NW2d 

875 (2013). The SBTA apportionment formula for the tax years at issue weighted the sales 

factor more heavily than the other factors, MCL 208.45a(1)(c), (2)(c), and there is no language in 

the SBTA indicating that a taxpayer was permitted to use an apportionment formula other than 

the one provided in that chapter. By contrast, the language of the Compact allowed a taxpayer to 

choose the equally weighted, three-factor formula in the Compact. MCL 205.581, Arts III(1), 

IV(9). As the Court of Claims explained, “[b]ecause the SBTA during the tax years in question 

mandates the use of one apportionment formula, while the Compact provides for the 

discretionary use of another apportionment formula, the statutes are in apparent conflict.” 
-13- 

However, we disagree with the Court of Claims that the two statutes cannot be 

harmonized. Rather, we find persuasive the reasoning utilized in the lead opinion in IBM, 496 

Mich at 651-662 (opinion by VIVIANO, J.),7

 concerning the interplay between the MBT and the 

Compact. Consistent with that analysis, we hold that it is possible to reasonably construe § 41 of 

the SBTA and Articles III(1) and IV(9) of the Compact in harmony with each other. 

The lead opinion explained, 

[W]here the intent of the Legislature is claimed to be unclear, it is our duty to 

proceed on the assumption that the Legislature desired both statutes to continue in 

effect unless it manifestly appears that such view is not reasonably plausible. 

Repeals by implication will be allowed only when the inconsistency and 

repugnancy are plain and unavoidable. We will construe statutes, claimed to be in 

conflict, harmoniously to find any other reasonable construction than a repeal by 

implication. Only when we determine that two statutes are so incompatible that 

both cannot stand will we find a repeal by implication. [IBM, 496 Mich at 651-

652 (opinion by VIVIANO, J.) (quotation marks and footnotes omitted).] 

In attempting to find a harmonious construction, courts should consider all statutes addressing 

the same general subject matter as comprising part of one system. Id. at 652, citing Rathbun v 

Michigan, 284 Mich 521, 544; 280 NW 35 (1938). “Further, ‘[s]tatutes in pari materia, although 

in apparent conflict, should, so far as reasonably possible, be construed in harmony with each 

other, so as to give force and effect to each . . . .’ ” IBM, 496 Mich at 652 (opinion by VIVIANO,

J.) (alterations in original), quoting Rathbun, 284 Mich at 544. 

It is a well-established rule that in the construction of a particular statute, or in the 

interpretation of its provisions, all statutes relating to the same subject, or having 

the same general purpose, should be read in connection with it, as together 

constituting one law, although they were enacted at different times, and contain 

no reference to one another. The endeavor should be made, by tracing the history 

of legislation on the subject, to ascertain the uniform and consistent purpose of the 

legislature, or to discover how the policy of the legislature with reference to the 

subject-matter has been changed or modified from time to time. In other words, 

in determining the meaning of a particular statute, resort may be had to the 

established policy of the legislature as disclosed by a general course of legislation. 

With this purpose in view therefore it is proper to consider, not only acts passed at 

the same session of the legislature, but also acts passed at prior and subsequent 

sessions. [IBM, 496 Mich at 652-653 (opinion by VIVIANO, J.), quoting Rathbun, 

284 Mich at 543-544 (block quote omitted).] 

 

7

 Because a majority of the justices in IBM did not agree on the implied-repeal analysis contained 

in the lead opinion, the lead opinion’s holding on that issue is not binding authority. See Burns v 

Olde Discount Corp, 212 Mich App 576, 582; 538 NW2d 686 (1995); Felsner v McDonald 

Rent-A-Car, Inc, 193 Mich App 565, 569; 484 NW2d 408 (1992). 
-14- 

Thus, the Compact’s election provision and § 41 of the SBTA should be construed together as 

statutes in pari materia because they share, like the Compact and the MBTA, “the common

purpose of setting forth the methods of apportionment of a taxpayer’s multistate business 

income.” IBM, 496 Mich at 653 (opinion by VIVIANO, J.).8

 In reviewing the statutes in pari materia, we conclude that the following reasoning, 

employed by the lead opinion in IBM with regard to the MBTA and the Compact, is equally 

applicable in this case: 

[T]he Compact’s election provision, by using the terms “may elect,” contemplates 

a divergence between a party state’s mandated apportionment formula and the 

Compact’s own formula—either at the time of the Compact’s adoption by a party 

state or at some point in the future. Otherwise, there would be no point in giving 

taxpayers an election between the two. In fact, reading the Compact’s election 

provision as forward-looking—i.e., contemplating the future enactment of a state 

income tax with a mandatory apportionment formula different from the 

Compact’s apportionment formula—is the only way to give meaning to the 

provision when it was enacted in Michigan. Viewed in this light, the [MBT’s] 

mandatory apportionment language may plausibly be read as compatible with the 

Compact’s election provision. 

 

8

 We recognize that the rule of in pari materia “does not permit the use of a previous statute to 

control by way of former policy the plain language of a subsequent statute . . . .” Voorhies v 

Faust, 220 Mich 155, 157; 189 NW 1006 (1922). However, neither the IBM lead opinion, nor 

our opinion in this case, effectively resolves the conflict between the MBT or the SBT in favor of 

the Compact, i.e., the earlier enacted statute, or permits the utilization of the apportionment 

provision in the Compact in such a way that contradicts the plain language of a subsequent 

statute. Rather, as explained in this opinion, we conclude that the apportionment provisions of 

the SBTA and the Compact can be read harmoniously. 

 Additionally, we recognize that “the interpretive aid of the doctrine of in pari materia can 

only be utilized in a situation where the section of the statute under examination is itself 

ambiguous.” Tyler v Livonia Pub Sch, 459 Mich 382, 392; 590 NW2d 560 (1999), citing 

Voorhies, 220 Mich at 157; see also In re Indiana Mich Power Co, 297 Mich App 332, 344; 824 

NW2d 246 (2012). However, this principle does not preclude the use of the doctrine in this case. 

Although the language of § 41 of the SBTA arguably may be unambiguous when read in 

isolation, the interpretation and construction of that section—or a determination of the 

applicability of that section on its own—is not at issue here. Rather, we are inescapably required 

to consider the effect of MCL 208.41 on the Compact election provision, which, in this case, 

clearly requires consideration of the statutes together in the context of the statutory scheme as a 

whole. Cf. KTS Indus, Inc, 263 Mich App at 36-37 (“[R]epeal by implication will not be found 

if any other reasonable construction may be given to the statutes, such as reading in pari materia

two statutes that share a common purpose or subject, or as one law, even if the two statutes were 

enacted on different dates and contain no reference to one another.”). 
-15- 

* * * 

 Because the Legislature gave no clear indication that it intended to repeal 

the Compact’s election provision, we proceed under the assumption that the 

Legislature intended for both to remain in effect. After reading the statutes in 

pari materia, we conclude that a reasonable construction exists other than a repeal 

by implication. Under Article III(1) of the Compact, the Legislature provided a 

multistate taxpayer with a choice between the apportionment method contained in 

the Compact or the apportionment method required by Michigan’s tax laws. If a 

taxpayer elects to apportion its income through the Compact, Article IV(9) 

mandates that the taxpayer do so using a three-factor apportionment formula. 

Alternatively, if the taxpayer does not make the Compact election, then the 

taxpayer must use the apportionment formula set forth in Michigan’s governing 

tax laws. In this case, IBM’s tax base arose under the [MBT]. Had it not elected 

to use the Compact’s apportionment formula, IBM would have been required to 

apportion its tax base consistently with the mandatory language of the [MBT]—

i.e., through the [MBT’s] sales-factor apportionment formula. Thus, we believe 

the [MBT] and the Compact are compatible and can be read as a harmonious 

whole. [Id. at 656-658 (opinion by VIVIANO, J.).] 

In the context of the instant case, the Legislature provided plaintiffs with a choice, 

through Article III(1) of the Compact, between the apportionment method contained in the 

Compact or the apportionment method required by the SBTA. If a taxpayer elects to apportion 

its income as provided by the Compact, Article IV(9) requires that the taxpayer do so using a 

three-factor apportionment formula. Alternatively, if the taxpayer does not elect the 

apportionment method under the Compact, then the taxpayer is required to use the apportionment 

formula set forth in the applicable tax laws. There is a reasonable construction that harmonizes 

the two statutes. Thus, the presumption against implied repeals has not been rebutted here. See 

id. at 660 (“[B]ecause there is a presumption against implied repeals, it is our task to determine if 

there is any other reasonable construction that would harmonize the two statutes and avoid a 

repeal by implication.” [Footnotes omitted.]). 

 The lead opinion in IBM also found that its conclusion that the Compact apportionment 

provision was not impliedly repealed was consistent with the development of Michigan tax law, 

concluding that a “review of the statutes in pari materia indicates a uniform and consistent 

purpose of the Legislature for the Compact’s election provision to operate alongside Michigan’s 

tax acts.” Id. at 656. The opinion noted that the Legislature, despite its full knowledge of the 

Compact, left its election provision intact while repealing or amending other acts that were 

inconsistent with provisions concerning business taxation. Id. at 657. Likewise, the opinion also 

noted the Legislature’s retroactive amendment of the Compact effective January 1, 2011, which 

did not apply to all tax years subject to the MBTA, in ascertaining the Legislature’s intent to 

keep the Compact’s provisions intact despite the enactment and amendment of the MBTA. Id. at 

658-659 (discussing 2011 PA 40). 

We acknowledge the enactment of 2014 PA 282, which provides, in pertinent part: 
-16- 

Enacting section 1. 1969 PA 343, MCL 205.581 to 205.589, is repealed 

retroactively and effective beginning January 1, 2008. It is the intent of the 

legislature that the repeal of 1969 PA 343, MCL 205.581 to 205.589, is to express 

the original intent of the legislature regarding the application of section 301 of 

the Michigan business tax act, 2007 PA 36, MCL 208.1301, and the intended 

effect of that section to eliminate the election provision included within section 1 

of 1969 PA 343, MCL 205.581, and that the 2011 amendatory act that amended 

section 1 of 1969 PA 343, MCL 205.581, was to further express the original 

intent of the legislature regarding the application of section 301 of the Michigan 

business tax act, 2007 PA 36, MCL 208.1301, and to clarify that the election 

provision included within section 1 of 1969 PA 343, MCL 205.581, is not 

available under the income tax act of 1967, 1967 PA 281, MCL 206.1 to 206.713. 

[Emphasis added.] 

Through 2014 PA 282, the Legislature clarified—contrary to the lead opinion’s conclusion in 

IBM—that it had intended to impliedly repeal the Compact when it enacted the MBT through 

2007 PA 36, and that this intent was further revealed by its subsequent express repeal of the 

Compact election provision, effective January 1, 2011, under 2011 PA 40. 

 However, in clarifying its legislative intent, the Legislature included nothing in 2014 PA 

282 regarding the validity of the Compact election provision for multistate taxpayers subject to 

the SBTA before the effective date of the MBTA. In so doing, the Legislature left open the 

application of the Compact apportionment formula during tax years subject to the SBTA. If it so 

chose, the Legislature easily could have closed this door. Instead, it chose not to, and it is not 

our role to second guess its reasoning for not doing so. Thus, we conclude, consistent with the 

lead opinion’s analysis in IBM, that 

the Legislature, in enacting [and amending] the [SBTA], had full knowledge of 

the Compact and its provisions. Even with such knowledge on [multiple] 

occasions, the Legislature left the Compact’s election provision intact [with 

regard to the SBTA]. By contrast, the Legislature expressly repealed or amended 

other inconsistent acts regarding the taxation of businesses[, including its repeal 

of the Compact with regard to tax years subject to the MBTA]. Had the 

Legislature believed that the Compact’s election provision no longer had a place 

in Michigan’s tax system or conflicted with the purpose of the [SBTA], it could 

have taken the necessary action to eliminate the election provision. [IBM, 496 

Mich at 657 (opinion by VIVIANO, J.).] 

See also id. at 659 n 59 (“ ‘[T]he later express repeal of a particular statute may be some 

indication that the legislature did not previously intend to repeal the statute by implication.’ ”), 

quoting 1A Singer, Sutherland Statutory Construction (7th ed), § 23:11, p 485. 

Accordingly, especially in light of the Legislature’s clear expressions of intent regarding 

the express and implied repeal of the Compact in conjunction with the enactment of the MBTA, 

and the lack of any indication that § 41 of the SBTA was intended to repeal the apportionment 

election provision in the Compact, we assume that the Legislature intended for the Compact 
-17- 

election provisions to remain in effect alongside the SBTA. See id. at 657. Additionally, as 

explained supra, the statutes may be reasonably construed in harmony. See id. 

Thus, because a “repeal by implication will not be found if any other reasonable 

construction may be given to the statutes,” KTS Indus, 263 Mich App at 36-37 (emphasis 

added), the Court of Claims erred in concluding that the Compact’s election provision was 

impliedly repealed by the SBTA. 

V. THE BINDING NATURE OF THE COMPACT AND OTHER CONSTITUTIONAL 

CHALLENGES 

Next, plaintiffs raise a series of arguments regarding whether the Compact was binding 

on subsequent legislatures, whether the Compact was superior to statutory law, and whether an 

implied repeal of the Compact would violate various state and federal constitutional provisions. 

These claims are rooted in the Court of Claims’ conclusion that the Compact was impliedly 

repealed by the SBTA. As explained supra, we hold that the SBTA did not impliedly repeal the 

Compact’s apportionment election provision. Thus, to the extent that plaintiffs assert that a 

repeal of the apportionment election provision of the Compact was impermissible or violated 

state and federal constitutional provisions, we need not address those claims in light of our 

holding.9

 Furthermore, we reject any of plaintiffs’ additional claims that are not rooted in the 

assumption that the SBTA impliedly repealed the election apportionment provisions of 

Compact—and, instead, concern whether the Compact is binding and superior to Michigan 

statutory law—for the reasons provided by this Court in reviewing the validity of 2014 PA 282 

in Gillette, which are discussed next in the context of Johnson Matthey’s challenges to 2014 PA 

282. 

 

9

 Plaintiffs also claim that the Court of Claims erred in determining that plaintiffs’ constitutional 

claims were untimely. For the reasons stated above, we need not address this issue. 

Nevertheless, we note that the Court of Claims correctly held that plaintiffs’ 

constitutional challenges were untimely. Pursuant to MCL 205.27a(7), a taxpayer claiming a 

refund on the basis that a Michigan tax statute is invalid under, or is preempted by, a 

constitutional provision or federal law must claim a refund within 90 days of the date set for 

filing a return. See also American States Ins Co v Dep’t of Treasury, 220 Mich App 586, 589, 

591; 560 NW2d 644 (1996). Plaintiffs are seeking refunds premised in part on claims that an 

implied repeal of the Compact election provision would violate various constitutional provisions. 

As such, they are claiming refunds based on arguments that a tax statute is preempted by 

constitutional provisions. Accordingly, under MCL 205.27a, they were required to file those 

claims within 90 days after the date set for filing a return. 

The Court of Claims found that plaintiffs did not assert their constitutional claims within 

the 90-day period, and plaintiffs fail to dispute that finding. Additionally, some plaintiffs do not 

even address the Court of Claims’ ruling that the constitutional claims were untimely. To the 

extent that these plaintiffs fail to address the basis of the Court of Claims’ decision, we deem this 

argument abandoned. Derderian v Genesys Health Care Sys, 263 Mich App 364, 381; 689 

NW2d 145 (2004). 
-18- 

VI. JOHNSON MATTHEY’S CHALLENGES TO 2014 PA 282 

In Docket No. 327251, Johnson Matthey challenges the validity and constitutionality of 

2014 PA 282 (hereinafter referred to as “PA 282”), which the Legislature enacted to 

retroactively withdraw Michigan from the Compact. We reject Johnson Matthey’s claims. 

 Johnson Matthey’s numerous state and federal constitutional challenges are identical in 

all relevant respects to the arguments raised by some of the plaintiffs in Gillette. In that case, we 

concluded that the Compact was not a binding contract on this state but was merely an advisory 

agreement, such that PA 282’s removal of Michigan from membership in the Compact was not 

prohibited. Gillette, ___ Mich App at ___; slip op at 18-19, 21-22. Further, “the Compact 

contained no features of a binding interstate compact and, therefore, was not a compact 

enforceable under the Contract Clause.” Id. at ___; slip op at 20. Accordingly, the Compact was 

not superior to statutory law, and it was “subject to Michigan law concerning the interpretation 

of statutes.” Id. at ___; slip op at 18-19, 22. See also id. at ___ n 4; slip op at 19 n 4. 

Furthermore, a retroactive repeal of the Compact did not violate the Contract Clauses of either 

the federal or state Constitutions. Id. at ___; slip op at 19, 21. 

We also held that “the retroactive repeal of the Compact did not violate the Due Process 

Clauses of either the state or federal [C]onstitutions or Michigan’s rules regarding retrospective 

legislation. Nor did it violate the terms of the Compact itself.” Id. at ___; slip op at 22. 

Additionally, we held that the enactment of PA 282 “did not violate the separation of powers 

provision of the state Constitution[.]” Id. at ___; slip op at 30. Moreover, “PA 282 does not 

violate the Commerce Clause” of the United States Constitution. Id. at ___; slip op at 32. We 

also concluded that “the enactment of 2014 PA 282 did not violate the Title-Object Clause, the 

Five-Day Rule, or the Distinct-Statement Clause of the Michigan Constitution.” Id. at ___; slip 

op at 34. Likewise, we rejected the plaintiffs’ change-in-purpose challenge. Id. at ___; slip op at 

38. 

 In sum, we rejected in Gillette the same arguments that Johnson Matthey raises here. 

Thus, Johnson Matthey’s constitutional challenges to PA 282 are devoid of merit. 

VII. WHETHER THE SBT IS AN INCOME TAX 

 Defendant argues on cross-appeal that the Court of Claims erred in concluding that the 

SBT is an income tax for purposes of the Compact election provision, such that the court 

erroneously concluded that the SBTA was subject to, and therefore conflicted with, the 

Compact’s election provision. We disagree. 

As stated supra, the Compact’s apportionment election provision previously stated: 

 (1) Any taxpayer subject to an income tax whose income is subject to 

apportionment and allocation for tax purposes pursuant to the laws of a party state 

or pursuant to the laws of subdivisions in 2 or more party states may elect to 

apportion and allocate his income in the manner provided by the laws of such 

state or by the laws of such states and subdivisions without reference to this 

compact, or may elect to apportion and allocate in accordance with Article IV . . . 

. [MCL 205.581, Art III(1) (emphasis added).] 
-19- 

The Compact defined an “income tax” as “a tax imposed on or measured by net income 

including any tax imposed on or measured by an amount arrived at by deducting expenses from 

gross income, 1 or more forms of which expenses are not specifically and directly related to 

particular transactions.” MCL 205.581, Art II(4). As such, “[u]nder the Compact’s broad 

definition, a tax is an income tax if the tax measures net income by subtracting expenses from 

gross income, with at least one of the expense deductions not being specifically and directly 

related to a particular transaction.” IBM, 496 Mich at 663 (opinion by VIVIANO, J.). 

 The SBT fits this definition. The SBT base is calculated by using federal taxable income 

as a starting point and then making various additions and subtractions as required by the act. 

Mobil Oil Corp v Dep’t of Treasury, 422 Mich 473, 497, 497 n 15; 373 NW2d 730 (1985). See 

also Trinova Corp v Dep’t of Treasury, 433 Mich 141, 150; 445 NW2d 428 (1989) (Trinova I), 

aff’d 498 US 358; 111 S Ct 818; 112 L Ed 2d 884 (1991); Lear Corp v Dep’t of Treasury, 299 

Mich App 533, 537; 831 NW2d 255 (2013) (“The SBTA unambiguously stated that ‘[tax base] 

means business income’ and ‘[business income] means federal taxable income.’ MCL 208.9(1); 

MCL 208.3(3).” [Alterations in original.]). Federal taxable income, for purposes of the SBT, 

consists of gross income minus deductions allowed by the federal tax code. See MCL 208.5(3), 

citing 26 USC 63. See also 26 USC 63(a); Mobil Oil, 422 Mich at 497 n 15. In general, 

deductions from gross income permitted by the federal tax code include ordinary and necessary 

expenses that are paid or incurred while running a business. See 26 USC 162(a); Mobil Oil, 422 

Mich at 489. 

As the Court of Claims explained, pursuant to MCL 208.9(2) through (6), “[t]he SBT . . . 

expands the income tax base by adding back some, but not all, of the federal expense deductions 

taken to arrive at federal taxable income.” The Court of Claims further explained: 

For example, except for compensation, most ordinary and necessary business 

expenses incurred in the carrying on of a trade or business are deducted from 

gross income to arrive at federal taxable income, but are not added back as part of 

the SBT tax base. The resulting tax is thus in part measured by “an amount 

arrived at by deducting expenses from gross income” for purposes of defining 

income tax under the Compact. That some expenses such as compensation are 

also added back to the SBT tax base before the tax is calculated does not alter the 

conclusion that the SBT is “imposed on or measured by an amount arrived at by 

deducting expenses from gross income, 1 or more forms of which expenses are 

not specifically and directly related to particular transactions.” Under the plain 

language of the Compact, it is therefore an income tax for Compact purposes. 

[Citations omitted.] 

See also Trinova I, 433 Mich at 150-151 (explaining some of the adjustments to “business 

income,” i.e., federal taxable income, which must be made when calculating the SBT base); id. at 

149 n 6 (noting that the SBTA prescribed “various exclusions, exemptions, and industry-specific 

adjustments”). 
-20- 

As the Court of Claims reasoned, some ordinary business expenses, such as insurance 

premiums, rent,10 and research and development costs, which are deducted when calculating 

federal taxable income,11 are not added back when determining the SBT base. See MCL 208.9 

(prescribing the adjustments to federal taxable income that are required in calculating the SBT 

base). Consistent with the Compact’s definition, these expenses are not specifically and directly 

related to particular transactions. See MCL 205.581, Art II(4). 

Therefore, because the SBT is calculated by beginning with federal taxable income, 

which consists of gross income minus federally allowed deductions, and because some 

deductions allowed under the federal tax code are not added back to the SBT base, it follows that 

the SBT is measured by an amount arrived at through the deduction of expenses from gross 

income. Thus, the Court of Claims properly determined that the SBTA qualifies as an income 

tax as defined by the Compact because it “tax[ed] a variation of net income[.]” IBM, 496 Mich 

at 667 (opinion by VIVIANO, J.). 

 As defendant emphasizes on appeal, we recognize that a provision of the SBTA stated 

that “[t]he tax levied under this section and imposed is upon the privilege of doing business and 

not upon income.” MCL 208.31(3). However, a similar provision of the MBTA provided that 

“[t]he [modified gross receipts tax (“MGRT”)] levied and imposed under this section is upon the 

privilege of doing business and not upon income or property,” MCL 208.1203(2), and this 

provision did not prevent the Michigan Supreme Court from unanimously concluding in IBM

that the MGRT was an “income tax” under the broad definition of that term in the Compact, see 

IBM, 496 Mich at 665-667 (opinion by VIVIANO, J.); id. at 664 (“Although this statement 

indicates that the MGRT is not a tax upon income under the [M]BTA, we must still determine 

whether the MGRT fits under the broad definition of ‘income tax’ under the Compact.”); id. at 

668 (ZAHRA, J., concurring); id. at 672 n 3 (MCCORMACK, J., dissenting). 

As the lead opinion in IBM explained, the Court was not required to “put a definitive 

label on the MGRT, a task with which commentators have struggled.” Id. at 663 n 70 (opinion 

by VIVIANO, J.). Commentators had characterized the MGRT as many types of taxes other than 

an income tax, but the lead opinion in IBM emphasized that its task was merely to determine 

whether the MGRT constituted an “income tax” under the Compact’s definition. Id.; see also id. 

at 667 n 85 (“Our holding is limited to the determination that the MGRT is included within the 

Compact definition of ‘income tax.’ . . . [W]e do not need to reach the issue whether the MGRT, 

generally, is an income tax.”). 

 Likewise, here, the labels that have been used to describe the SBT in various contexts are 

not dispositive of whether the SBT qualifies as an income tax under the broad Compact 

 

10 Although most rental expenses are not added back to the SBT base, MCL 208.9(4)(h) required 

a federal deduction for rent attributable to certain “lease back” transactions to be added back to 

the SBT base. 

11 See 26 USC 162(a) (allowing federal deductions for ordinary and necessary expenses paid or 

incurred in carrying on a trade or business). 
-21- 

definition of that term. Although both the United States Supreme Court and the Michigan 

Supreme Court have characterized the SBT as a value-added tax that measures business activity 

rather than an income tax, see Trinova II, 498 US at 367; Trinova I, 433 Mich at 149, those 

characterizations were not made in the context of the Compact definition of an income tax. 

Similarly, even though this Court treated the SBT as a value-added tax rather than an income tax 

in determining the application of a federal statute barring state taxes imposed on or measured by 

net income derived from interstate commerce, when the only activity in the state involved 

solicitation of orders, see Gillette Co v Dep’t of Treasury, 198 Mich App 303, 307-311; 497 

NW2d 595 (1993), that analysis was not conducted under the Compact definition of an income 

tax. The issue here is limited to the application of the Compact definition; no definitive 

characterization of the SBT is required, just as no definitive characterization of the MGRT was 

required in IBM in order to conclude that it was an income tax under the Compact. See IBM, 496 

Mich at 663 n 70 (opinion by VIVIANO, J.). 

VIII. WHETHER PLAINTIFFS’ CLAIMS ARE BARRED BY THE RETROACTIVE

REPEAL OF THE COMPACT BY 2014 PA 282 

Lastly, defendant argues on cross-appeal that the explicit repeal of the Compact by PA 

282 extends to tax years 2005, 2006, and 2007, and taxpayers subject to the SBTA during those 

years. In particular, defendant contends that the language of PA 282 stating that the Compact “is 

repealed retroactively and effective beginning January 1, 2008,” means that no taxpayer may 

attempt to elect the Compact apportionment method following that date. We disagree. 

 Defendant’s contention is contravened by the language of the enacting section of PA 282: 

Enacting section 1. 1969 PA 343, MCL 205.581 to 205.589, is repealed 

retroactively and effective beginning January 1, 2008. It is the intent of the 

legislature that the repeal of 1969 PA 343, MCL 205.581 to 205.589, is to express 

the original intent of the legislature regarding the application of section 301 of the 

Michigan business tax act, 2007 PA 36, MCL 208.1301, and the intended effect 

of that section to eliminate the election provision included within section 1 of 

1969 PA 343, MCL 205.581, and that the 2011 amendatory act that amended 

section 1 of 1969 PA 343, MCL 205.581, was to further express the original 

intent of the legislature regarding the application of section 301 of the Michigan 

business tax act, 2007 PA 36, MCL 208.1301, and to clarify that the election 

provision included within section 1 of 1969 PA 343, MCL 205.581, is not 

available under the income tax act of 1967, 1967 PA 281, MCL 206.1 to 206.713. 

This language plainly indicates that the Compact was expressly repealed beginning January 1, 

2008. The SBTA was no longer in effect on January 1, 2008, as it was repealed effective 

December 31, 2007. See 2006 PA 325. Moreover, the enacting section of PA 282 indicates that 

the Legislature’s explicit repeal of the Compact was intended to effectuate the Legislature’s 

original intent concerning the application of MCL 208.1301, a section of the MBTA, and the 

intended effect of that section to eliminate the apportionment election provision of the Compact. 

The enacting section of PA 282 also explains that 2011 PA 40 was intended to further express 

the Legislature’s original intent with regard to the application of MCL 208.1301 and to clarify 

that the Compact apportionment election provision was not available under the income tax act of 
-22- 

1967. There is no language in the enacting section that suggests a legislative intent to repeal the 

Compact with respect to tax years affected by the SBTA or with respect to SBT taxpayers. See 

Sun Valley Foods, 460 Mich at 236 (“If the language of the statute is unambiguous, the 

Legislature must have intended the meaning clearly expressed, and the statute must be enforced 

as written.”). 

 Moreover, the lead and concurring opinions in IBM also support the conclusion that PA 

282’s explicit repeal of the Compact effective January 1, 2008 did not extend to tax years before 

2008. In IBM, our Supreme Court analyzed 2011 PA 40, which contained language similar to 

the enacting section of PA 282. 2011 PA 40 stated that “beginning January 1, 2011[,]” a 

taxpayer subject to the MBTA or the income tax act of 1967 could not elect to use the Compact 

apportionment formula. The lead and concurring opinions concluded that the Compact election 

provision was in effect for the 2008 tax year at issue in IBM, implicitly finding that the 

“beginning January 1, 2011” language in 2011 PA 40 denotes tax years beginning in 2011. See 

IBM, 496 Mich at 659 (opinion by VIVIANO, J.); id. at 668-670 (ZAHRA, J., concurring). See also 

Gillette, ___ Mich App at ___; slip op at 17 (“In IBM, the Supreme Court held that through 2011 

PA 40 the Legislature created a window (from January 1, 2008 until January 1, 2011) wherein 

relevant taxpayers could still utilize the apportionment option available under Article IV of the 

Compact.”). Likewise, the language in PA 282 stating that the Compact was repealed “effective 

beginning January 1, 2008,” is properly understood as indicating that the express repeal of the 

Compact applies to tax years beginning on January 1, 2008. 

Thus, the express repeal of the Compact by PA 282 does not apply to the SBTA. 

IX. CONCLUSION 

 We agree with plaintiffs that the trial court erred in concluding that the SBTA impliedly 

repealed the Compact election provision. However, the rest of plaintiffs’ claims on appeal, as 

well as defendant’s alternative grounds for affirmance, lack merit. 

Reversed and remanded for further proceedings consistent with this opinion. We do not 

retain jurisdiction. No costs, an issue of public importance being involved. MCR 7.219(A). 

/s/ Michael J. Riordan 

/s/ Kathleen Jansen 

/s/ Karen M. Fort Hood