SB-0240, As Passed Senate, March 20, 2003

SENATE BILL No. 240

February 27, 2003, Introduced by Senators GEORGE, GARCIA, BERNERO, SCHAUER, GOSCHKA, ALLEN and CLARKE and referred to the Committee on Local, Urban and State Affairs.

                                                                             A bill to amend 1913 PA 380, entitled                                             

"An act to regulate gifts of real and personal property to                  

cities, villages, townships, and counties, and the use of the               

those gifts; and to validate all such gifts made before the                 

enactment of this act,"                                                     

by amending the title and section 2 (MCL 123.872), the title as             

amended and section 2 as added by 1985 PA 9.                                

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

1                                 TITLE                                         

2                                                                                An act to regulate gifts of real and personal property to                          

3   cities, villages, townships, and counties, and the use of  the

4   those gifts and other funds; and to validate all  such  gifts               

5   made before  the enactment of this act August 14, 1913.                    

6       Sec. 2.  (1) To provide a means and method to encourage and                 

7   assist businesses in locating and expanding in this state, and if           

8   not prohibited by the terms of the grant, a city, village,                  

9   township, or county may use a federal, state, or local grant or             

Senate Bill No. 240 as amended March 19, 2003               (Page 1 of 2)   

1   the proceeds of a federal, state, or local grant to make a                  

2   secured or unsecured loan or to make a grant to a private person,           

3   to a corporation or other business association, to a city,                  

4   village, township, or county, or to an instrumentality of a city,           

5   village, township, or county.  A county may grant or loan funds             

6   that are not derived from ad valorem taxes to a township,                   

7   village, or city located within that county for the purpose of              

8   encouraging and assisting businesses to locate and expand within            

9   the county. <<The county shall establish an application process for proposals to receive a grant or loan under this subparagraph.  The application process shall require adequate public notice that the funds are available, what the criteria is for awarding the funding, and a specific statement of the public purpose for which the funding is being made available.  The awarding of a grant or loan under this subparagraph shall be made at a public hearing of the county board of commissioners.  The grant or loan contract shall require a report to the county board of commissioners not less than annually regarding the activities of the recipient and the degree to which the recipient has met the stated public purpose of the funding.>>

10      (2) A loan or grant made  pursuant to under subsection (1)                 

11  may be used for local public improvements or to encourage and               

12  assist businesses in locating or expanding in this state, to                

13  preserve jobs in this state, to encourage investment in the                 

14  communities in this state, or for other public purposes.                    

15      (3) The right to repayment of a loan made under subsection                  

16  (1) may be assigned by a city, village, township, or county to an           

17  entity, agency, or authority created  pursuant to under law, or            

18  to a private corporation or association created to make and                 

19  administer loans made under subsection (1).                                 

20      (4) A city, village, township, or county may receive loans                  

21  pursuant to under subsection (1) and issue loan revenue bonds             

22  secured by the repayment of loans made under subsection (1).  For           

23  the purposes specified in subsection (2), bonds issued  pursuant            

24  to under this section shall be approved by the department of               

Senate Bill No. 240 as amended March 19, 2003              (Page 2 of 2)

25  treasury before their issuance, but shall not otherwise be                  

26  subject to  the provisions of  the revised municipal finance act,           

27  Act No. 202 of the Public Acts of 1943, being sections 131.1 to            

1   139.3 of the Michigan Compiled Laws 2001 PA 34, MCL 141.2101 to            

2   141.2821.  In determining whether the issuance of the bonds shall           

3   be approved, the department of treasury shall take into                     

4   consideration the following:                                                

5       (a) Whether the bonds conform to the provisions of law.                     

6       (b) Whether the probable revenue and properties pledged for                 

7   payment of the bonds will be sufficient to pay the principal of             

8   and interest on the bonds when due.                                         

9       (c) Whether the amount of the proposed issue is sufficient or               

10  excessive for the purpose for which the bonds are to be issued.             

11  (5) The loan revenue bonds shall not be general obligations                 

12  of the city, village, township, or county issuing the loan                  

13  revenue bonds.  The loan revenue bonds are declared to be issued            

14  for an essential public and governmental purpose, and, together             

15  with interest on those bonds and income from those bonds, shall             

16  be exempted from all taxes.