Industrial revenue bonds in Michigan
Volume cap, active issuers, the local buyer base and the steps to finance a manufacturing, recycling, water or housing project in Michigan with tax-exempt bonds.
State facts verified October 2026Key takeaways
- $1.4B of volume cap in 2026 — the federal $135 per resident applied to 10.13 million residents; rank 10 of 51 by size.
- 10 Michigan issuer entries appear in SEC-registered fund holdings, $69.0M in total, −$3.5M over the latest quarter (filers report some issuers under more than one name).
- 60 FDIC-insured banks headquartered in the state hold $2.4B of municipal securities — the natural direct purchasers for small issues.
- 4 single-state municipal funds buy Michigan bonds specifically, which supports in-state demand and pricing.
Issuers whose bonds funds already hold
Registered funds’ holdings show which Michigan issuers buyers already know. The tables cover all conduit and private activity issuers in fund holdings — including transportation, housing, nonprofit and pollution-control issuers — so they are context for demand, not a list of issuers that do manufacturing bonds.
| Series | Held | Change |
|---|---|---|
| Michigan Strategic Fund, Limited Obligation Pollution Control Revenue Refunding Bonds, Detroit Edison Company, Variable Rate Demand Obligations, Serie | $20.2M | +$965K |
| Michigan Strategic Fund, Limited Obligation Revenue Bonds, Detroit Edison Company Exempt Facilities Project, Refunding Variable Rate Series 2008ET-2 | $19.6M | +$829K |
| Rockport, Indiana, Pollution Control Revenue Refunding Bonds, Indiana Michigan Power Company Project, Series 2025A | $13.8M | +$13.8M |
| Michigan Strategic Fund, Limited Obligation Revenue Bonds, Detroit Edison Company Exempt Facilities Project, Collateralized Series 2023DT | $7.2M | −$32K |
The local buyer base
Banks
60 FDIC-insured banks are headquartered in Michigan, together holding $2.4B of municipal securities in the latest call reports. Banks often buy small industrial issues outright (direct purchase) or provide letters of credit that let money market funds buy variable-rate bonds.
Funds
National high-yield municipal funds are the core buyers of unrated industrial bonds. 4 single-state funds focus on Michigan:
- Franklin Tax Free Trust
- Fidelity Municipal Trust
- Nuveen Multistate Trust IV
- BlackRock MuniYield Michigan Quality Fund, Inc.
How Michigan allocates volume cap
Allocating agency: Michigan Department of Treasury, Bureau of State and Authority Finance (the State Treasurer allocates the unified volume limitation under Act 496 of 1988). The 2026 Master Order, dated February 20, 2026, sets the unified volume limitation at $1,367,264,340. It replaces the statutory state/municipal split and monthly installments with one pool, all of it held for future use. The State Treasurer allocates from the pool when needed, takes requests in any order, and chooses eligible projects. Eligible issuers include the Michigan Strategic Fund and municipal issuers for small-issue manufacturing and exempt facility projects. An allocation expires December 31, 2026 unless the approving order says otherwise or the Treasurer extends it. Cap that is unissued, expired or only partly used before September 30, 2026 may be reallocated by the Treasurer. A separate carryforward application is available from Treasury.
State allocation fees. Michigan Strategic Fund (per MEDC fact sheet dated 08/2021): non-refundable application fee of $500 for $1 million or less, $1,000 above $1 million. Issuance fee, due on or before closing: one-quarter of 1% for $10 million or less; $25,000 plus one-eighth of 1% of the amount over $10 million. Refundings: one-eighth of 1%, minimum $2,000, maximum $40,000. Not-for-profit issuance fee maximum $40,000. The applicant pays to publish the hearing notice. No Treasury fee for an allocation was found.
Next published date: December 31, 2026 — Allocations expire unless the order or the Treasurer provides otherwise (62 days from this page’s build). All states’ dates
| Milestone | Date |
|---|---|
| 2026 Master Order signed | February 20, 2026 |
| Cap from unissued, expired or partly used allocations may be reallocated by the Treasurer | After September 30, 2026 |
| Allocations expire unless the order or the Treasurer provides otherwise | December 31, 2026 |
| Notice of delivery (Form 4549) due to the State Treasurer after bonds are delivered | Within 10 days of delivery |
| MSF board meetings left in 2026 (9:00 a.m., MEDC Lansing office) | October 27, 2026; December 15, 2026 (combined November/December) |
Issuers that do manufacturing bonds
| Issuer | Type |
|---|---|
| Michigan Strategic Fund (MEDC) | statewide authority |
| Municipal issuers of small-issue manufacturing and exempt facility bonds (as named in the Treasury Master Order) | county/city issuer |
State approvals
For MSF bonds: background check forms due to MSF staff 60 days before the board meeting, and the bond application 45 days before. The MSF board adopts an inducement resolution. MSF staff publish the public hearing notice at least 14 days ahead and hold the hearing in Lansing. The board then adopts the bond-authorizing resolution. Issuers request volume cap from the State Treasurer on Treasury Form 1411 (Act 496 section 5). Manufacturing projects must spend 95% of proceeds on land, building and equipment directly related to manufacturing, and at least 70% on core manufacturing costs. MSF Board Resolution 2005-234 bars volume cap for solid or hazardous waste facilities that serve the general public.
Incentives that commonly stack with the bonds
1 state programme verified on official pages. Eligibility and amounts are set by each programme; the bonds do not confer them.
- Property taxIndustrial Facilities Exemption (PA 198 of 1974): the State Tax Commission issues Industrial Facility Exemption certificates covering approved real and personal property investment (a property tax abatement for industrial facilities).
Who to call
- Michigan Department of Treasury, Bureau of State and Authority Finance, 430 W Allegan St, Lansing, MI 48922; 517-335-0994; Treas_BondFinance@michigan.gov
- MEDC customer contact center (Michigan Strategic Fund bonds), 888-522-0103
Sources: michigan.gov (1) · michigan.gov (2) · michiganbusiness.org (1) · michiganbusiness.org (2) · michigan.gov (3) · checked October 2026. Procedures and fees change; confirm with the agency and bond counsel.
Not found on an official page yet: a published figure for cap remaining. We leave these out rather than estimate; ask the allocating agency.
How to finance a project in Michigan
- Confirm eligibility. Manufacturing projects up to $10 million under the small-issue capital expenditure election, or an exempt facility such as solid waste, water or qualified housing. See the guide.
- Choose an issuer. In Michigan, issuers with published industrial bond programs include Michigan Strategic Fund and Municipal issuers of small-issue manufacturing and exempt facility bonds (see the issuer table above). A county or city industrial development authority, a port authority or a statewide finance authority can serve; the fund-holdings tables are context, not a directory. How to choose an issuer.
- Obtain a declaration of official intent (inducement resolution). Costs paid up to 60 days before it, and any time after, can be reimbursed from bond proceeds (Treas. Reg. §1.150-2).
- Apply for volume cap to the state’s allocating agency, Michigan Department of Treasury, Bureau of State and Authority Finance. Michigan’s 2026 ceiling is $1.4B; allocation is at the state’s discretion, by round, lottery or first-come, and the ceiling is not the amount still available.
- Hold the TEFRA hearing after at least seven days’ public notice (the issuer’s website may be used) and obtain the elected official’s approval. If the issuer sits outside the project’s jurisdiction, an elected official of the host jurisdiction must also approve; approval lapses if bonds are not issued within a year.
- State approvals, documents and closing. Some states add their own steps — attorney general review, court validation or a state commission’s approval. Bond counsel drafts the documents; a bank buys the bonds directly or a placement agent places them with investors.
The order of these steps varies by state: some require the public hearing and local approval before they allocate volume cap.
Questions borrowers ask
Do industrial revenue bonds in Michigan need volume cap?
Most do. Federal law (IRC §146) requires small-issue manufacturing bonds and most exempt-facility bonds to receive an allocation of the state’s annual cap, which for Michigan is $1.4B this year. Governmentally owned airports, docks and solid waste facilities, and qualified 501(c)(3) bonds, do not.
Who issues industrial revenue bonds in Michigan?
Issuers with published industrial bond programs in Michigan include Michigan Strategic Fund and Municipal issuers of small-issue manufacturing and exempt facility bonds. County and city development authorities, port authorities and statewide finance authorities issue depending on the state, and national conduits can issue with the host jurisdiction’s approval. The allocating agency (Michigan Department of Treasury, Bureau of State and Authority Finance) can confirm who is active.
Who buys Michigan industrial revenue bonds?
National high-yield municipal funds, banks — including the 60 headquartered in the state — insurers and separately managed accounts, plus 4 funds dedicated to Michigan bonds.
How long does it take?
Typically three to six months from engagement to closing; volume cap rounds and issuer board calendars can add time.
Check whether your project qualifies Read the complete guide
Methodology
Volume cap is the 2026 federal formula — $135 per resident with a $397,625,000 small-state minimum (Rev. Proc. 2025-32) — applied to Census Vintage 2025 population estimates; where a state publishes its own figure, the state’s figure governs. It is the annual ceiling, not the amount still available. Issuer and bond figures are holdings reported by SEC-registered funds on Form N-PORT, classified by Securitief; bank figures are municipal securities in FDIC call reports for banks headquartered in the state.
Important information. Securitief Research is published by Securitief, operated by Applied America. Securitief is not a placement agent or underwriter and does not seek or receive compensation from any financing, including financings of issuers and borrowers discussed here. It is not acting as a municipal advisor and owes no fiduciary duty to any issuer or obligated person unless separately engaged in writing.
This material is general information. It is not tax, legal, investment or municipal advice, a recommendation, or an offer to sell or a solicitation of an offer to buy any security. Offers are made only by offering documents and only where permitted by state securities laws. State allocation procedures change; confirm current rules with the allocating agency and bond counsel.
Sources: SEC Form N-PORT and FDIC call reports (holdings), IRS and Census (volume cap and population), state agency publications. Issuer classification and aggregation are Securitief’s own and may contain matching errors; figures may be revised. No licensed index levels (MMD, BVAL, ICE) or EMMA trade data are used. Past holdings do not indicate future demand, pricing or the availability of financing. Interest on private activity bonds may be subject to the alternative minimum tax; tax treatment depends on the facts and the opinion of bond counsel.