House Introduced Bill 5838

HOUSE BILL No. 5838


     April 9, 2002, Introduced by Rep. Hart and referred to the Committee on Tax Policy.


        A bill to amend 1956 PA 111, entitled

   "An act to provide for the acquisition, construction, establish-
   ment, opening, altering, improving and maintaining of highways;
   authorizing contracts between townships and boards of county road
   commissioners for the same; authorizing townships to finance
   their share of the cost of the same from its contingent fund,
   special assessments, and bonds or short term notes issued in
   anticipation of the receipt of sales tax moneys or general obli-
   gation bonds; and to prescribe procedures and conditions relative
   to the issuance of said bonds or short term notes,"

   by amending sections 4 and 5 (MCL 247.354 and 247.355), section 4

   as amended by 1983 PA 109.

               THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

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             Sec. 4.  (1) Bonds issued under this act in anticipation of

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        sales tax  money  REVENUE to be returned to the township shall be

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         serial bonds with annual maturities, the aggregate of which

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        shall not exceed 15, the first of which shall fall due not more

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        than 2 years from the date of issuance, and no maturity after 2

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        years from date of issuance shall be less than 1/3 of the amount


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        of any subsequent maturity.  Short term notes issued under this

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        act in anticipation of sales tax money to be returned to the

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        township shall have a due date not more than 9 months after date

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        of issuance.  The said bonds or short term notes shall bear

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        interest at a rate or rates not exceeding 5% per annum, may be

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        made redeemable on such terms and conditions as shall be provided

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        by the bond or short term note authorizing resolution, and may be

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        made registrable as to principal only under such terms and condi-

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        tions as may be determined by the township board.  The principal

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        of and interest on said bonds or short term notes shall be  pay-

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        able primarily from the proceeds of revenues derived from sales

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        tax  money  REVENUE collected by the state and returned to the

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        township  pursuant to  UNDER section 10 of article IX of the

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        state constitution of 1963.

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             (2) As additional security for the payment of  said  THE

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        bonds, the township board may submit to the qualified electors of

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        the township the question of pledging the full faith and credit

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        of the township for the payment of  said  THE bonds, as provided

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        in section 5; and if a majority of the qualified electors voting

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        on the issue  shall favor  APPROVE the  same  QUESTION, the town-

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        ship board may pledge the full faith and credit of the township

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        for the payment of  said  THE bonds, in which event, if the sales

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        tax  money is  PROCEEDS ARE not sufficient  therefor, said  TO

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        PAY THE bonds and the interest  thereon  ON THE BONDS, THEY shall

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        be payable from any money in the contingent fund of the township

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        or from ad valorem taxes  which  THAT the township shall levy

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        without limitation as to rate or amount.



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             (3) The township board in  said  THE resolution shall make

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        an irrevocable pledge and appropriation of an amount sufficient

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        for payment of the principal of and interest upon  said  THE

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        bonds or short term notes from revenues derived from sales tax

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         money  REVENUE collected by the state and returned to the town-

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        ship  pursuant to  UNDER section 10 of article IX of the state

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        constitution of 1963.  The township board may not pledge for

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        annual debt service requirements in any future calendar year on

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         said  THE bonds or short term notes an amount in excess of 50%

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        of the average revenues derived from sales tax  money  REVENUES

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        collected by the state and returned to the township  pursuant to

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        UNDER section 10 of article IX of the state constitution of 1963

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        in the 3 calendar years  next  IMMEDIATELY preceding the

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        borrowing.  Nothing contained in this section shall be construed

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        as a prohibition against successive borrowings  so long as  IF

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        the total amount of revenues pledged for annual debt service

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        requirements  shall  DOES not exceed the applicable percentage

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        described in this section.

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              (4) Unless an exception from prior approval is available

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        pursuant to subsection (5), the municipal finance commission or

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        its successor agency may approve or deny, in whole or in part,

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        such borrowing and the issuing of said bonds or short term notes

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        therefor, in accordance with Act No.  202 of the Public Acts of

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        1943, as amended, being sections 131.1 to 139.3 of the Michigan

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        Compiled Laws.

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              (5) The authorization of subsection (4) for the municipal

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        finance commission or its successor agency to approve or deny the



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        issuance of bonds or notes under this act shall be subject to

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        sections 10 and 11 of chapter III of Act No. 202 of the Public

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        Acts of 1943, being sections 133.10 and 133.11 of the Michigan

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        Compiled Laws, and the department of treasury shall have the same

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        authority as provided by section 11 of chapter III of Act No. 202

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        of the Public Acts of 1943 to issue an order providing or denying

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        an exception from the prior approval authorized by subsection (4)

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        for bonds or notes authorized by this act.

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             (4) BONDS AND NOTES ISSUED UNDER THIS ACT ARE SUBJECT TO THE

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        REVISED MUNICIPAL FINANCE ACT, 2001 PA 34, MCL 141.2101 TO

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        141.2821.

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             Sec. 5.  General obligation bonds issued under this act

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        shall be issued only after their issuance has been authorized by

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        a majority vote of the qualified electors of the township voting

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        on the proposition of issuing the bonds at a general or special

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        township election and only after the qualified electors of the

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        township have voted an increase in the tax rate limitation

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        imposed by section 6 of article  9  IX of the state constitution

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        of 1963, in an amount and for a period of time necessary to

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        permit the collection of taxes in an amount sufficient to meet

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        the principal and interest requirements on the proposed bonds.  A

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        township may not issue general obligation bonds under this act

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        for an amount greater than 10% of the total assessed valuation of

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        the township.  , as last equalized by the state, nor shall the

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        last maturity of the bonds fall due more than 20 years from the

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        date of issuance thereof.  The general obligation bonds shall be

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        issued and sold subject to  and in accordance with Act No.  202



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        of the Public Acts of 1943, as amended, being sections 131.1 to

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        138.2 of the Michigan Compiled Laws  THE REVISED MUNICIPAL

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        FINANCE ACT, 2001 PA 34, MCL 141.2101 TO 141.2821.


















































   02337'01          Final page.                            JLB