SENATE BILL No. 974

December 13, 2001, Introduced by Senator DE BEAUSSAERT and referred to the Committee on Finance.

A bill to amend 1939 PA 342, entitled

"County public improvement act of 1939,"

by amending sections 5a and 5c (MCL 46.175a and 46.175c), section

5c as amended by 1983 PA 183.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

1 Sec. 5a. As an additional or alternative method of acquir-

2 ing and constructing any of the improvements or facilities autho-

3 rized by this act, the county, acting through its county agency,

4 and any unit of government may enter into contracts providing for

5 the acquisition, construction, and financing of improvements or

6 facilities in the manner herein authorized IN THIS ACT. The

7 contracts shall provide for the allocation and payment of the

8 share of the total cost thereof to be borne by each unit of

9 government in annual installments, for a period of not exceeding

10 40 years, and each contracting unit of government is authorized

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1 to pledge its full faith and credit for the payment of the

2 obligation in the manner and times specified in the contracts. A

3 CONTRACT DESCRIBED IN THIS SECTION IS SUBJECT TO SECTION 517 OF

4 THE REVISED MUNICIPAL FINANCE ACT, 2001 PA 34, MCL 141.2517. For

5 the purpose of making payment of its pledged share of the cost of

6 such THE improvements or facilities, any contracting unit of

7 government may use any, or all, or any combination of the follow-

8 ing methods of raising funds: necessary therefor:

9 (a) The levy of a tax on taxable property by a unit of gov-

10 ernment having the power to tax, which tax may be imposed without

11 limitation as to rate or amount and in addition to any taxes that

12 the unit of government may be authorized to levy but not more

13 than the rate or amount sufficient therefor FOR THOSE

14 PURPOSES.

15 (b) The levy of special assessments on property benefited by

16 such THE improvements, the procedures relative to the making

17 and collection of such THE special assessments to conform as

18 near as may be to applicable charter or statutory provisions.

19 therefor.

20 (c) The levy and collection of rates or charges to users and

21 beneficiaries of the service furnished by the improvement.

22 (d) From moneys MONEY received or to be received derived

23 from the imposition of taxes by the THIS state, except as the

24 use of the money for such THAT purpose is expressly prohibited

25 by the state constitution OF 1963.

26 (e) From any other funds which THAT may be validly used

27 for such THAT purpose. The contracts may provide for any and

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1 all matters relating to the acquisition, construction, and

2 financing of the improvements or facilities as are deemed

3 CONSIDERED necessary, including the authority to the county

4 agency to issue bonds secured by the full faith and credit con-

5 tractual pledges of the contracting unit of government, as autho-

6 rized by section 5c. The contracts may provide for appropriate

7 remedies in case of default, including, but not limited to, the

8 right of the contracting unit of government to authorize the

9 state treasurer or other official charged with the disbursement

10 of unrestricted state funds returnable to the governmental units

11 pursuant to UNDER the Michigan STATE constitution OF 1963, to

12 withhold sufficient funds to make up any default or deficiency in

13 funds.

14 Sec. 5c. (1) For the purpose of obtaining funds for the

15 acquisition and construction of the improvements or facilities

16 authorized by this act, the county after the execution of the

17 contract or contracts authorized by sections 5a and 5b, upon res-

18 olution adopted by its county board of commissioners, may issue

19 its negotiable bonds secured by the full faith and credit pledges

20 made by each contracting unit of government pursuant to authori-

21 zation contained in this act and the contract or contracts

22 entered into pursuant to sections 5a and 5b. The bonds shall not

23 be delivered until the contract or contracts become effective as

24 provided in section 5b. The bonds shall be issued in the name of

25 the county and shall be executed in such manner as provided in

26 the resolution authorizing the bonds. Bonds issued hereunder

27 shall be negotiable instruments and shall be serial bonds payable

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1 annually, with the first maturity due not more than 5 years and

2 the last maturity not more than 40 years from the date thereof.

3 An annual maturity payable after 5 years from the date of the

4 bonds shall not be less than 1/5 of the amount of any subsequent

5 maturity on the same series of bonds. The bonds shall bear

6 interest payable semiannually except that the first coupon may be

7 for any number of months not exceeding 10. The bonds and coupons

8 shall be made payable in lawful money of the United States of

9 America and shall be exempt from all taxation whatsoever by the

10 state or by any taxing authority within the state. The county

11 board of commissioners may authorize the county agency to sell

12 any such bonds in accordance with the laws of the state at a

13 price and bearing interest at a rate not more than the maximum

14 permitted by the municipal finance act, Act No. 202 of the Public

15 Acts of 1943, as amended, being sections 131.1 to 139.3 of the

16 Michigan Compiled Laws. The bonds may be sold at a discount not

17 to exceed 10% of the principal amount thereof. Any contract or

18 contracts entered into pursuant to sections 5a and 5b may provide

19 that interest on the bonds to be issued shall be paid from the

20 proceeds of sale of the bonds for a period not exceeding the

21 estimated construction period and 1 year thereafter in which

22 event the resolution adopted by the county board of commissioners

23 may provide for the payment of the interest from the proceeds of

24 sale of the bonds and the resolution shall specify the interest

25 payments which are to be paid from the proceeds of sale of the

26 bonds. The bonds shall not pledge the full faith and credit of

27 the issuing county except as hereinafter provided. As additional

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1 security for the payment of the principal of and interest on any

2 bonds issued under the provisions of this section, any issuing

3 county may, upon proper resolution adopted by a majority vote of

4 the members-elect of its county board of commissioners, pledge

5 the full faith and credit of the county for the prompt payment of

6 the principal of and interest on such bonds and, if necessary,

7 may impose taxes without limitation as to rate or amount and in

8 addition to any other taxes the county may be authorized to levy

9 for the payment of such principal and interest and in addition to

10 any taxes that the unit of government may be authorized to levy

11 but not more than the rate or amount sufficient therefor. In the

12 event the county is required to advance any money by reason of

13 such A pledge on account of the delinquency of any contracting

14 unit of government and if PROVIDED IN the contract, shall so

15 provide, the county treasurer shall notify the state treasurer

16 to deduct the amount of money so advanced by the county from

17 any unrestricted moneys MONEY in the state treasurer's posses-

18 sion belonging to the unit of government and to pay such THE

19 amount to the county. The moneys MONEY shall be paid into the

20 general fund of the county. The right of deduction to receive

21 payment from the state treasurer given to the county by this

22 statute shall not operate to limit the county's right to pursue

23 any other legal remedies for the reimbursement of moneys MONEY

24 advanced hereunder UNDER THIS SECTION. The board of commis-

25 sioners of any county which THAT has advanced any money and

26 which THAT has not been reimbursed therefor may order a unit

27 of government having taxing power and its officers to levy upon

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1 its next tax roll an amount sufficient to make the reimbursement

2 on or before the date when its taxes become delinquent and the

3 unit of government and its tax levying and collecting officials

4 shall levy and collect such THE taxes and reimburse the

5 county. The resolution authorizing the issuance of the bonds

6 shall have embodied therein CONTAIN the terms of the contract

7 or contracts authorized by sections 5a and 5b. Sections 5a, 5b,

8 and 5c shall be construed as an additional and alternative method

9 for the acquisition, construction, and financing of the improve-

10 ments or facilities contemplated by this act, and shall not

11 affect the other provisions of this act relating thereto TO THE

12 ACQUISITION, CONSTRUCTION, OR FINANCING OF IMPROVEMENTS OR

13 FACILITIES. Any improvements and facilities contemplated by this

14 act may be acquired, constructed, and financed in part under the

15 provisions of sections 5a, 5b, and 5c and in part under other

16 sections of this act. This act shall not validate any drain

17 orders or bonds issued prior to April 30, 1954.

18 (2) Unless an exception from prior approval is available

19 pursuant to subsection (3), bonds shall not be issued under this

20 section until the municipal finance commission or its successor

21 agency approves the issuance of same and in determining whether a

22 proposed issue of bonds shall be approved, the municipal finance

23 commission or its successor agency shall take into consideration

24 whether the bonds conform to the provisions of this act.

25 (2) (3) The requirement of subsection (2) for obtaining the

26 prior approval of the municipal finance commission or its

27 successor agency before issuing bonds under this section shall be

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1 subject to sections 10 and 11 of chapter III of Act No. 202 of

2 the Public Acts of 1943, being sections 133.10 and 133.11 of the

3 Michigan Compiled Laws, and the department of treasury shall have

4 the same authority as provided by section 11 of chapter III of

5 Act No. 202 of the Public Acts of 1943 to issue an order provid-

6 ing or denying an exception from the prior approval required by

7 subsection (2) for bonds authorized by this act. BONDS ISSUED

8 UNDER THIS ACT ARE SUBJECT TO THE REVISED MUNICIPAL FINANCE ACT,

9 2001 PA 34, MCL 141.2101 TO 141.2821.

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