SENATE BILL No. 1084

February 5, 2002, Introduced by Senator SIKKEMA and referred to the Committee on Finance.

A bill to amend 1976 PA 448, entitled

"Michigan energy employment act of 1976,"

by amending section 42 (MCL 460.842), as amended by 1983 PA 120.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

1 Sec. 42. (1) A joint agency may issue bonds to pay all or

2 part of project costs or to refund all or any part of the out-

3 standing bonds or notes of the joint agency. The bonds shall be

4 payable from and may be issued in anticipation of payment of the

5 proceeds of any of the methods of financing described in section

6 41 or elsewhere in this act or as may be provided by law. A

7 member municipality of the joint agency may contract as provided

8 in section 43 or may contract to make payments, appropriations,

9 or contributions to the joint agency of the proceeds of taxes,

10 special assessments, or charges imposed and collected by the

11 member municipality or out of other funds legally available, and

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1 may pledge its full faith and credit in support of its

2 contractual obligation to the joint agency. The contractual

3 obligation shall not constitute an indebtedness of the municipal-

4 ity within a statutory or charter debt limitation. If the joint

5 agency issues bonds in anticipation of payments, appropriations,

6 or contributions to be made to the joint agency pursuant to con-

7 tract by a political subdivision having the power to levy and

8 collect ad valorem taxes, the political subdivision may obligate

9 itself by the contract, and thereupon may levy a tax on all tax-

10 able property within the political subdivision, which tax as to

11 rate or amount will not be subject to limitation, as provided in

12 section 6 of article IX of the state constitution of 1963, for

13 contract obligations in anticipation of which bonds are issued to

14 provide sufficient moneys MONEY to fulfill its contractual

15 obligation to the joint agency. IF THE CONTRACT HAS BEEN

16 APPROVED BY THE ELECTORS OF THE MUNICIPALITY, THE CONTRACT IS

17 SUBJECT TO THE REVISED MUNICIPAL FINANCE ACT, 2001 PA 34,

18 MCL 141.2101 TO 141.2821.

19 (2) The bonds may be:

20 (a) Issued for any period of years not exceeding 50.

21 (b) Serial bonds or term bonds, or a combination of both

22 serial and term bonds.

23 (c) Issued for a consideration other than cash.

24 (d) For an amount which THAT includes interest capitalized

25 for a period of not more than 10 years after the date of the

26 bonds.

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1 (e) Sold at public or private sale, as determined by the

2 joint agency, at a discount not to exceed 10%.

3 (f) Secured by revenues, contract payments, funds or invest-

4 ments and securities as determined by the joint agency.

5 (3) The resolution authorizing bonds may provide for the

6 appointment of 1 or more trustees for bondholders and a trustee

7 may be an individual or corporation domiciled or located within

8 or without the THIS state and may be given appropriate powers

9 whether with or without the execution of an indenture.

10 (4) Unless an exception from prior approval is available

11 pursuant to subsection (7), bonds BONDS issued by any joint

12 agency shall be approved by the municipal finance commission or

13 its successor agency prior to their issuance but, except as pro-

14 vided by subsection (7), shall not otherwise be subject to the

15 municipal finance act, Act No. 202 of the Public Acts of 1943, as

16 amended, being sections 131.1 to 139.3 of the Michigan Compiled

17 Laws. Before approving the issuance of the bonds the municipal

18 finance commission or its successor agency shall determine that

19 the amount of the proposed issue is sufficient but not excessive,

20 that the revenue and properties pledged for the payment thereof

21 are sufficient, and that the bonds and the proceedings authoriz-

22 ing the same comply with this act and other applicable law.

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

24 2001 PA 34, MCL 141.2101 TO 141.2821.

25 (5) A municipality , OR governmental unit , private cor-

26 poration, firm, or individual may advance moneys MONEY or

27 deliver property to the joint agency to enable it to carry out or

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1 finance any of its powers and duties. The joint agency may agree

2 to repay an advance or pay for the property within a period of

3 not more than 10 years, from the proceeds of its bonds or from

4 other funds legally available for that purpose, with or without

5 interest as may be agreed at the time of the advance or

6 delivery. The obligation of the joint agency to make the repay-

7 ment or payment may be evidenced by contract or note, which con-

8 tract or note may pledge a source of payment determined by the

9 joint agency. Unless an exception from prior approval is avail-

10 able pursuant to subsection (7), the contract or note shall be

11 subject to prior approval by the municipal finance commission or

12 its successor agency.

13 (6) A municipality desiring to enter into a contract under

14 this section pledging the full faith and credit of the municipal-

15 ity shall authorize, by resolution of its governing body, the

16 execution of the contract. Subsequent to the adoption of the

17 resolution a notice thereof OF THE CONTRACT shall be published

18 in a newspaper of general publication in the municipality, which

19 notice shall state:

20 (a) That the governing body has adopted a resolution autho-

21 rizing execution of the contract.

22 (b) The purpose thereof OF THE CONTRACT.

23 (c) The source of payment of the municipality's contractual

24 obligation.

25 (d) The right of referendum thereon ON THE CONTRACT.

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1 (e) Such ANY other information as THAT governing body

2 shall determine DETERMINES to be necessary to adequately inform

3 all interested persons of the nature of the obligation.

4 (7) The contract may be executed and delivered by the munic-

5 ipality upon approval by its governing body without a vote of the

6 electors, thereon, but the contract shall not become effective

7 until the expiration of 45 days after the date of publication of

8 such THE notice. If within the 45-day period a petition signed

9 by at least 10% or 15,000, whichever is the lesser, of the regis-

10 tered electors residing within the limits of the municipality is

11 filed with the clerk thereof OF THE MUNICIPALITY requesting a

12 referendum upon the contract, the same CONTRACT shall not

13 become effective until approved by the vote of a majority of the

14 electors of the municipality qualified to vote and voting

15 thereon ON THE QUESTION at a general or special election, which

16 election shall be held within 180 days after the filing of a

17 petition. When any such A contract DESCRIBED IN THIS SECTION

18 is to be entered into by any township only on behalf of the unin-

19 corporated area of the township, only the registered electors

20 residing within the unincorporated area of the township shall be

21 qualified to sign the petition and vote at the election.

22 (7) The requirement of subsections (4) and (5) for obtain-

23 ing the prior approval of the municipal finance commission or its

24 successor agency before issuing bonds, notes, or contracts under

25 this section shall be subject to sections 10 and 11 of chapter

26 III of Act No. 202 of the Public Acts of 1943, being sections

27 133.10 and 133.11 of the Michigan Compiled Laws, and the

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1 department of treasury shall have the same authority as provided

2 by section 11 of chapter III of Act No. 202 of the Public Acts of

3 1943 to issue an order providing or denying an exception from the

4 prior approval required by subsections (4) and (5) for bonds,

5 notes, and contracts authorized by this section.

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