(1) As used in this chapter:

    (a) “Assessable property” means real property in a district area other than all of the following:

    (i) Property classified as residential real property under section 34c of the general property tax act, 1893 PA 206, MCL 211.34c, unless the local governmental unit expressly designates property classified as residential real property as assessable property as part of its special assessment proceedings.

    (ii) Property owned by the federal, a state, or a local unit of government where property is exempt from the collection of taxes under the general property tax act, 1893 PA 206, MCL 211.1 to 211.155.

    (iii) One or more classes of property owners whose property meets all of the following conditions:

    (A) Is exempt from the collection of taxes under the general property tax act, 1893 PA 206, MCL 211.1 to 211.155, other than property identified in subparagraph (i) or (ii).

    (B) As a class has been determined by the legislative body of the local governmental unit not to be benefited by a project for which special assessments are to be levied.

    (b) “Business improvement district” means 1 or more portions of a local governmental unit or combination of contiguous portions of 2 or more local governmental units that are predominantly commercial or industrial in use.

    (c) “District” means a business improvement district or a principal shopping district.

    (d) “Highways” means public streets, highways, and alleys.

    (e) “Local governmental unit” means a city, village, or urban township.

    (f) “Principal shopping district” means a portion of a local governmental unit designated by the governing body of the local governmental unit that is predominantly commercial and that contains at least 10 retail businesses.

    (g) “Urban township” means a township that is an urban township as defined in section 402 of the recodified tax increment financing act, 2018 PA 57, MCL 125.4402, and is a township located in a county with a population of more than 750,000.

    (2) A local governmental unit with a master plan for the physical development of the local governmental unit that includes an urban design plan designating a principal shopping district or includes the development or redevelopment of a principal shopping district, or 1 or more local governmental units that establish a business improvement district by resolution, may do 1 or more of the following:

    (a) Subject, where necessary, to approval of the governmental entity that has jurisdiction over the highway, open, widen, extend, realign, pave, maintain, or otherwise improve highways and construct, reconstruct, maintain, or relocate pedestrian walkways.

    (b) Subject, where necessary, to approval of the governmental entity that has jurisdiction over the highway, prohibit or regulate vehicular traffic where necessary to carry out the purposes of the development or redevelopment project.

    (c) Subject, where necessary, to approval of the governmental entity that has jurisdiction over the highway, regulate or prohibit vehicular parking on highways.

    (d) Acquire, own, maintain, demolish, develop, improve, or operate properties, off-street parking lots, or structures.

    (e) Contract for the operation or maintenance by others of off-street parking lots or structures owned by the local governmental unit, or appoint agents for the operation or maintenance.

    (f) Construct, maintain, and operate malls with bus stops, information centers, and other buildings that will serve the public interest.

    (g) Acquire by purchase, gift, or condemnation and own, maintain, or operate real or personal property necessary to implement this section.

    (h) Promote economic activity in the district by undertakings including, but not limited to, conducting market research and public relations campaigns, developing, coordinating, and conducting retail and institutional promotions, and sponsoring special events and related activities. A business may prohibit the use of its name or logo in a public relations campaign, promotion, or special event or related activity for the district.

    (i) Provide for or contract with other public or private entities for the administration, maintenance, security, operation, and provision of services that the board determines are a benefit to a district within the local governmental unit.

    (3) A local governmental unit that provides for ongoing activities under subsection (2)(h) or (i) shall also provide for the creation of a board for the management of those activities.

    (4) One member of the board of the principal shopping district shall be from the adjacent residential area, 1 member shall be a representative of the local governmental unit, and a majority of the members shall be nominees of individual businesses located within the principal shopping district. The board shall be appointed by the chief executive officer of the local governmental unit with the concurrence of the legislative body of the local governmental unit. However, if all of the following requirements are met, a business may appoint a member of the board of a principal shopping district, which member shall be counted toward the majority of members required to be nominees of businesses located within the principal shopping district:

    (a) The business is located within the principal shopping district.

    (b) The principal shopping district was designated by the governing body of a local governmental unit after July 14, 1992.

    (c) The business is located within a special assessment district established under section 5.

    (d) The special assessment district is divided into special assessment rate zones reflecting varying levels of special benefits.

    (e) The business is located in the special assessment rate zone with the highest special assessment rates.

    (f) The square footage of the business is greater than 5.0% of the total square footage of all businesses in that special assessment rate zone.

    (5) If the boundaries of the principal shopping district are the same as those of a downtown district designated under part 2 of the recodified tax increment financing act, 2018 PA 57, MCL 125.4201 to 125.4230, the governing body may provide that the members of the board of the downtown development authority, which manages the downtown district, shall compose the board of the principal shopping district, in which case subsection (4) does not apply.

    (6) The members of the board of a business improvement district shall be determined by the local governmental unit as provided in this subsection. The board of a business improvement district shall consist of all of the following:

    (a) One representative of the local governmental unit appointed by the chief executive officer of the local governmental unit with the concurrence of the legislative body of the local governmental unit in which the business improvement district is located. If the business improvement district is located in more than 1 local governmental unit, then 1 representative from each local governmental unit in which the business improvement district is located shall serve on the board as provided in this subdivision.

    (b) Other members of the board shall be nominees of the businesses and property owners located within the business improvement district. If a class of business or property owners, as identified in the resolution described in subsection (8), is projected to pay more than 50% of the special assessment levied that benefits property in a business improvement district for the benefit of the business improvement district, the majority of the members of the board of the business improvement district shall be nominees of the business or property owners in that class. The board shall include no less than 1 owner of residential real property if residential real property is determined assessable property by the local governmental unit under subsection (1).

    (7) A local governmental unit may create 1 or more business improvement districts.

    (8) If 1 or more local governmental units establish a business improvement district by resolution under subsection (2), the resolution shall identify all of the following:

    (a) The geographic boundaries of the business improvement district.

    (b) The number of board members in that business improvement district.

    (c) The different classes of property owners in the business improvement district.

    (d) The class of business or property owners, if any, who are projected to pay more than 50% of the special assessment levied that benefits property in that business improvement district.