As used in this act, “veteran” means an individual who meets all of the following:

  (a) Is a veteran as defined in section 1 of 1965 PA 190, MCL 35.61.

  (b) Is a legal resident of this state or was a legal resident of this state immediately prior to entering the United States Armed Forces. However, an individual whose legal residence was in this state prior to entering the United States Armed Forces does not meet the requirement of this subdivision if he or she leaves this state for a period of time exceeding 2 years.

  (c) He or she served in active service in the United States Armed Forces during a period of war for at least 180 days and was honorably discharged from the United States Armed Forces. However, an individual who separated from the United States Armed Forces for reason of physical or mental disability incurred in the line of duty prior to the completion of 180 days’ service is considered to meet the requirement of this subdivision. As used in this subdivision, “period of war” means that phrase as described in 38 C.F.R. § 3.2, except that for purposes of this subdivision, “period of war” for the Vietnam era means the following:

  (i) February 28, 1961 through May 7, 1975 for a veteran who served during that period.

  (ii) On or after January 31, 1955 in an area of hazardous duty for which the veteran received an Armed Forces Expeditionary Medal or Vietnam Service Medal.