SB-0482, As Passed Senate, December 17, 2003                                

HOUSE SUBSTITUTE FOR

SENATE BILL NO. 482

                                                                             A bill to amend 1976 PA 451, entitled                                             

"The revised school code,"                                                  

by amending section 1274a (MCL 380.1274a), as amended by 1990 PA            

227.                                                                        

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

1       Sec. 1274a.  (1) The board of a school district,                            

2   intermediate school district, or local act school district may              

3   provide contract with a qualified provider for energy                     

4   conservation improvements  to be made  to school facilities.  and           

5   may pay for the improvements These improvements may be paid from           

6   operating funds of the school district or from the proceeds of              

7   bonds or notes issued for energy conservation improvements, or              

8   the board or intermediate school board may enter into 1 or more             

9   energy saving performance contracts.  in which the cost of the              

10  energy conservation improvements is paid from a portion of the              

1   savings which result from the improvements.  These  contractual             

2   agreements may provide contracts may contain a written financial           

3   guarantee providing that the costs of improvements will be paid             

4   only if the energy savings are sufficient to cover them.  Energy            

5   conservation improvements may include, but are not limited to,              

6   heating system improvements, fenestration improvements, roof               

7   improvements, the installation of any insulation, the                       

8   installation or repair of heating or air conditioning controls,             

9   and entrance or exit way closures building envelope                        

10  improvements; heating and cooling upgrades; lighting retrofits;             

11  installing or upgrading an energy management system; motor, pump,           

12  or fan replacements; domestic water use reductions; and upgrading           

13  other energy consuming equipment or appliances.                             

14  (2) A school board or intermediate school board that                        

15  contracts for energy conservation improvements under subsection             

16  (1) may require the qualified provider to furnish a bond that               

17  guarantees energy cost savings for a specified period of time.              

18      (3) If a school board or intermediate school board enters                   

19  into an energy saving performance contract under this section,              

20  all of the following apply:                                                 

21      (a) The bids for the contract shall provide a detailed                      

22  breakdown of the energy performance savings to be derived each              

23  year and for the duration of the energy saving performance                  

24  contract, including at least all of the following:                          

25                                                                               (i) A description of the guaranteed energy use savings and                          

26  tasks to be performed under the energy saving performance                   

27  contract.                                                                   

Senate Bill No. 482 (H-1) as amended December 10, 2003

1   (ii) The combined total net cost of all of the energy                        

2   conservation measures in the project.                                       

3       (iii) The projected energy savings and operating and                         

4   maintenance cost savings resulting from the project.                        

5       (iv) The useful life of each energy conservation measure.                    

6       (v) The simple payback period.                                              

7       (b) The qualified provider shall certify that measurement and               

8   verification techniques for determining cost savings will be                

9   performed in accordance with [the protocols published in January 2001 by

10  the international performance measurement and verification protocol inc.

11                                             ]                                

12  (4)  (2)  The board of a school district, intermediate school               

13  district, or local act school district may provide for the                  

14  removal or treatment of asbestos or other material injurious to             

15  health for school facilities and may pay for the improvements               

16  from operating funds of the school district or from the proceeds            

17  of bonds or notes issued for  such that purpose.                           

18  (5)  (3)  Issuance of bonds for the purposes authorized by                  

19  this section shall be considered as issued for capital                      

20  expenditures for all purposes including section 16 of article IX            

21  of the state constitution of 1963.                                          

22  (6)  (4)  Energy conservation improvements or substance                     

23  removal or treatment authorized by this section  shall be is

24  subject to the competitive bidding requirements of section 1267.            

25  (7)  (5)  If energy conservation improvements are made by a                 

26  school district, local act school district, or  an  intermediate            

27  school district as provided in this section, the school board  of           

1   the school district or an or intermediate school  district

2   board shall report the following information to the  Michigan               

3   public service commission state treasurer within 60 days after             

4   the completion of the improvements:                                         

5       (a) Name of each facility to which an improvement was made                  

6   and a description of the conservation improvements.                         

7       (b) Actual energy consumption during the 12-month period                    

8   before completion of the improvement.                                       

9       (c) Project costs and expenditures.                                         

10      (d) Estimated annual energy savings.                                        

11  (8)  (6)  If energy conservation improvements are made as                   

12  provided in this section, the school board  of the school                   

13  district or an or intermediate school  district board shall               

14  report to the  Michigan public service commission state                    

15  treasurer by July 1 of each of the 5 years after the improvements           

16  are completed the actual annual energy consumption of each                  

17  facility to which improvements were made.  The forms for the                

18  reports required by this section shall be furnished by the                  

19  Michigan public service commission state treasurer.                       

20  (9) As used in this section:                                                

21      (a) "Energy saving performance contract" means an agreement                 

22  for the evaluation, recommendation, and implementation of energy            

23  conservation measures including, but not limited to, an energy              

24  audit or detailed energy study; the design, installation,                   

25  operation, and maintenance of 1 or more energy conservation                 

26  measures; energy management services; and an energy savings                 

27  guarantee.                                                                  

1       (b) "Qualified provider" means an individual or a business                  

2   entity that is experienced in performing design, analysis, and              

3   installation of energy conservation improvements and facility               

4   energy management measures and that will provide these services             

5   under the contract with a guarantee or on a performance basis.