HB-6004, As Passed House, September 14, 2006
April 26, 2006, Introduced by Reps. Palmer, Hoogendyk, Ball, Mortimer, Gosselin, Robertson, Hildenbrand, Wenke, Meyer, Proos, Pearce, Vander Veen, Hopgood and Pastor and referred to the Committee on Education.
A bill to amend 1976 PA 451, entitled
"The revised school code,"
by amending sections 614, 620, 622a, 623a, 1267, and 1274 (MCL
380.614, 380.620, 380.622a, 380.623a, 380.1267, and 380.1274),
section 614 as amended by 2004 PA 419, section 620 as added by 2004
PA 413, section 622a as added by 2004 PA 412, sections 623a and
1274 as amended by 2004 PA 588, and section 1267 as amended by 2004
PA 232.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 614. (1) Except as provided in section 615 and subject to
section 642 of the Michigan election law, MCL 168.642, the members
of the intermediate school board shall be elected biennially at a
meeting on the first Monday in June by an electoral body composed
of 1 person designated by the board of each constituent school
district.
(2) All of the following apply to the election under
subsection (1):
(a) The board of a constituent district shall designate its
representative to this electoral body by resolution adopted not
earlier than 21 days before the date of this biennial election. The
board shall consider the resolution at not less than 1 public
meeting before adopting the resolution. This public meeting shall
not be held on the same day as the meeting at which the resolution
is adopted. The public meeting may be held as part of a regularly
scheduled board meeting. The resolution shall be adopted by
majority vote of the members serving on the board.
(b) In its resolution designating its representative, the
board of a constituent district shall identify the candidate the
board supports for each position to be filled on the intermediate
school board and shall direct its representative to vote for that
individual or individuals at least on the first ballot taken by the
electoral body.
(c) If a majority of the constituent district boards name the
same candidate for a particular position in the resolution
described in subdivision (b), then that candidate shall be
considered to be elected to that position as if he or she were
elected under subsection (1) and the electoral body is not required
to vote on that position at the meeting of the electoral body. If
that position is the only position to be filled that year, the
election meeting under subsection (1) is not required.
(d) The secretary of the intermediate school board shall send
a notice by certified mail of the hour and place of the meeting of
the electoral body described in subsection (1) to the secretary of
the board of each constituent school district at least 10 days
before the meeting. The president and secretary of the intermediate
school board shall act as chairperson and secretary at the meeting.
The meeting of the electoral body shall be an open meeting
conducted in the manner prescribed under the open meetings act,
1976 PA 267, MCL 15.261 to 15.275.
(e) If the election of a candidate at the election would
result in the intermediate school board including more than 3
members who are also members of a constituent district board in
violation of section 612, then all of the following apply:
(i) The intermediate school board member-elect whose election
causes the violation shall resign either the seat on the
intermediate school board or the seat on the constituent district
board.
(ii) If the violation is caused by the election of more than 1
member-elect, then the member-elect with the lowest number of votes
shall resign either the seat on the intermediate school board or
the seat on the constituent district board. If there was a tie in
the number of votes, then the member-elect who is required to
resign 1 of the seats shall be determined by a coin toss.
(iii) If a member-elect resigns his or her seat on the
intermediate school board as a result of subparagraph (i) or (ii),
then at the meeting of the electoral body nominations shall be
taken from the floor for election of a new member-elect who is not
also a member of a constituent district board, and a new member-
elect who is not also a member of a constituent district board
shall be elected at the meeting. A candidate nominated at the
meeting under this subparagraph is not required to have filed
petitions under subsection (5) or to have paid a filing fee under
subsection (7).
(3) Except as provided in section 703, the term of office of
each member elected to the intermediate school board is 6 years and
begins on July 1 following election. Not more than 2 members of the
intermediate school board shall be from the same school district
unless there are fewer districts than there are positions to be
filled.
(4) A vacancy shall be filled by the remaining members of the
intermediate school board until the next biennial election at which
time the vacancy shall be filled for the balance of the unexpired
term. Notice of the vacancy shall be filed with the state board
within 5 days after the vacancy occurs. If the vacancy is not
filled within 30 days after it occurs, the vacancy shall be filled
by the state board. This subsection does not apply to a situation
described in subsection (2)(e).
(5)
Subject to subsection subsections (2)(e) and (7),
a
candidate for election to the intermediate school board shall be
nominated by petitions that are signed by a number of school
electors of the combined constituent school districts of the
intermediate school district, as follows:
(a) If the population of the intermediate school district is
less than 10,000 according to the most recent federal census, a
minimum of 6 and a maximum of 20.
(b) If the population of the intermediate school district is
10,000 or more according to the most recent federal census, a
minimum of 40 and a maximum of 100.
(6) A school elector may sign as many petitions as there are
vacancies to fill. Nominating petitions and an affidavit as
provided in section 558 of the Michigan election law, 1954 PA 116,
MCL
168.558, shall be filed with the school district filing
official
secretary of the intermediate
school board not later than
30
60 days before the date of the biennial election meeting under
subsection
(1). The school district filing official secretary of
the intermediate school board shall determine the sufficiency of
the
petitions and the eligibility of the candidates nominated. The
school
district filing official secretary
of the intermediate
school board shall provide ballots for the biennial election,
listing on the ballots the names of all candidates properly
nominated. The
Except as otherwise provided
in subsection (2)(e),
the chairperson of the biennial election meeting may accept
nominations for a vacancy from the floor only if no nominating
petitions have been filed for the vacancy.
(7) Instead
Subject to subsection
(2)(e), instead of filing
nominating petitions, a candidate for election to the intermediate
school
board may pay a nonrefundable filing fee of $100.00 to the
school
district filing official
secretary of the intermediate
school board. If this fee is paid by the due date for nominating
petitions, the payment has the same effect under this section as
the filing of nominating petitions.
Sec. 620. (1) Not later than December 31 of each year, each
intermediate school district shall post on its website a report
containing all of the following information for the immediately
preceding school fiscal year in the form and manner prescribed by
the department:
(a) All of the following general information:
(i) The amount of the intermediate school district's total
budget.
(ii) The number of full-time equated pupils served by the
intermediate school district.
(iii) The number of employees employed by the intermediate
school district.
(iv) The number of constituent districts, public school
academies, and nonpublic schools served by the intermediate school
district.
(b) Except as otherwise provided in subsection (2) and subject
to subsection (9), for each intermediate school board member or
school administrator of the intermediate school district who had
travel expenses during the school fiscal year that totaled more
than $3,000.00 and that were paid for with intermediate school
district funds, all of the following information concerning that
travel:
(i) The total cost of air travel.
(ii) The total cost of overnight lodging.
(iii) The total cost of car rental.
(iv) The total cost of meals.
(v) The dates, purpose, and locations of travel.
(vi) The name and position of the board member or
administrator.
(c) Except as otherwise provided in subsection (3) and subject
to subsection (5), for each contract, other than an employment
contract or a contract that is reported under subdivision (f), that
was entered into by the intermediate school district during the
school fiscal year and that either obligated the intermediate
school district for an amount in excess of $100,000.00; was not
competitively bid and obligated the intermediate school district
for an amount in excess of $25,000.00; or was entered into with an
entity in which an intermediate school board member or school
administrator of the intermediate school district, or a family
member of an intermediate school board member or school
administrator of the intermediate school district, was known by the
intermediate school board to have a monetary interest, a
description of the contract that includes at least all of the
following:
(i) The subject matter and cost of the contract.
(ii) Whether the contract was competitively bid or was a single
source contract.
(iii) The name and position of each individual who signed the
contract on behalf of the intermediate school district.
(d) Except as otherwise provided in subsection (3), if there
was a modification made during the school fiscal year to an
existing contract that resulted in an additional financial
obligation owed by the intermediate school district in excess of
$100,000.00 or that resulted in the total financial obligation owed
by the intermediate school district from the existing contract
exceeding $100,000.00, or was a modification to an existing
contract that was not competitively bid and the modification
resulted in an additional financial obligation owed by the
intermediate school district in excess of $25,000.00 or resulted in
the total financial obligation owed by the intermediate school
district from the existing contract exceeding $25,000.00, a
description of the modification and the total amount of the
additional and total financial obligation.
(e) Subject to subsection (4), for each intermediate school
district employee with a compensation package with a total annual
monetary value in the top 3% among the intermediate school
district's employees, all of the following:
(i) The dollar value of his or her salary.
(ii) The dollar value of all expense accounts provided for the
employee and the dollar value of all reimbursed expenses.
(iii) The dollar value of any bonus, stipend, or any other form
of supplemental compensation. As used in this subparagraph,
"supplemental compensation" means any payment or benefit made
available to that employee that is not generally made available to
all teaching, administrative, and executive-level employees of the
intermediate school district.
(f) Total costs incurred during the school fiscal year, and
the source or sources of the money expended during the school
fiscal year, for fiber optic or cable equipment and operating
system software for fiber optic or cable equipment networks. The
description of the source or sources of the money expended for
purposes described in this subdivision shall specify the amount
used from each of the separate funds maintained by the intermediate
school district and used from each other source.
(g) Payments made during the school fiscal year to persons who
were not employees of the intermediate school district for public
relations, polling, lobbying, or legal services and a description
of the services received by the intermediate school district in
return. Payments for legal services may be reported as an annual
aggregate amount. Other payments required to be reported under this
subdivision shall be reported by specifying each individual
payment.
(h) For each person not included under subdivision (e) or (g)
to whom the intermediate school district was required to issue a
federal income tax form 1099 that showed payments in excess of
$25,000.00 during the school fiscal year, the total amount paid to
the individual, a description of the project or projects for which
the person was contracted, and the services provided by the person.
(i) The amount and percentage of the intermediate school
district's total budget that was spent on each of the following:
(i) Administrative costs, as defined under the Michigan public
school accounting manual.
(ii) Public relations, surveys, polling, lobbying, and legal
services.
(j) A list of all motor vehicles weighing 7,500 pounds or less
that were owned or leased by the intermediate school district
during the school fiscal year and are not reported under
subdivision (c) and a description of the purposes for which each of
these motor vehicles was used.
(2) Subsection (1)(b) does not apply to any of the following:
(a) Round-trip air travel on a scheduled airline from a
location in the Upper Peninsula to a location in the Lower
Peninsula or chartered round-trip air travel from a location in the
Upper Peninsula to a location in the Lower Peninsula if the cost of
the chartered air travel is less than the published cost of the
same air travel on a scheduled airline.
(b) Travel expenses for air or boat travel for work-related
purposes within this state between an island and the mainland.
(c) Travel expenses for travel within the boundaries of the
intermediate school district for work-related purposes.
(d) Mileage reimbursement.
(3) Subsection (1)(c) and (d) does not apply to a contract for
utilities or to a contract for an annuity or retirement benefit in
which all employees are eligible to participate unless the contract
is for payment of a commission to a third-party broker for securing
1 of those contracts.
(4) If an intermediate school district has fewer than 3
employees in the top 3% of employees as described in subsection
(1)(e), the intermediate school district shall include the
information required under subsection (1)(e) for each intermediate
school district employee with a compensation package with a total
monetary value in the top 3 among the intermediate school
district's employees. If an intermediate school district has more
than 20 employees in the top 3% of employees as described in
subsection (1)(e), the intermediate school district shall include
the information under subsection (1)(e) for each intermediate
school district employee with a compensation package with a total
monetary value in the top 20 among the intermediate school
district's employees.
(5) For the purposes of subsection (1)(c), an intermediate
school board member or school administrator of an intermediate
school district, or a family member of an intermediate school board
member or school administrator of an intermediate school district,
is not considered to have a monetary interest in any of the
following contracts:
(a) A contract between the intermediate school district and
any of the following:
(i) A corporation in which an intermediate school board member,
intermediate school district administrator, or family member is a
stockholder owning 1% or less of the total stock outstanding in any
class if the stock is not listed on a stock exchange or owning
stock that has a present market value of $25,000.00 or less if the
stock is listed on a stock exchange.
(ii) A corporation in which a trust, if an intermediate school
board member, intermediate school district administrator, or family
member is a beneficiary under the trust, owns 1% or less of the
total stock outstanding in any class if the stock is not listed on
a stock exchange or owning stock that has a present market value of
$25,000.00 or less if the stock is listed on a stock exchange.
(iii) A professional limited liability company organized
pursuant to the Michigan limited liability company act, 1993 PA 23,
MCL
450.5101 to 450.6200 450.5200, if an
intermediate school
board member, intermediate school district administrator, or family
member is an employee but not a member of the company.
(b) A contract between the intermediate school district and
any of the following:
(i) A corporation in which an intermediate school board member,
intermediate school district administrator, or family member is not
a director, officer, or employee.
(ii) A firm, partnership, or other unincorporated association,
in which an intermediate school board member, intermediate school
district administrator, or family member is not a partner, member,
or employee.
(iii) A corporation or firm that has an indebtedness owed to an
intermediate school board member, intermediate school district
administrator, or family member.
(c) A contract between the intermediate school district and a
constituent district.
(6) The department shall include on its website a link to the
page on each intermediate school district's website that includes
the intermediate school district's report under subsection (1).
(7) The department shall work with intermediate school
districts to determine the form and manner for the posting of the
report under subsection (1).
(8) An intermediate school district shall maintain the report
under subsection (1) on its website only for the most recent
reporting period, but shall maintain paper copies of previous
reports for at least 10 years.
(9) Beginning January 1, 2006, the monetary amount specified
in subsection (1)(b) shall be adjusted each January 1 by
multiplying the amount for the immediately preceding year by the
percentage by which the average consumer price index for all items
for the 12 months ending August 31 of the year in which the
adjustment is made differs from that index's average for the 12
months ending on August 31 of the immediately preceding year and
adding that product to the maximum amount that applied in the
immediately preceding year, rounding to the nearest whole dollar.
The adjustment shall apply only to expenditures or violations
occurring after the date of the adjusting of the amount. The
adjusted amount shall be determined and announced by the department
on or before December 15 of each year and shall be provided to all
persons requesting the adjusted amount. If the index is
unavailable, the department shall make a reasonable approximation.
(10) As used in this section:
(a) "Competitively bid" means that a contract was entered into
through a request for information, a request for proposal, or a
formal competitive bid process that was advertised and open to the
public, and includes a contract entered into on behalf of the
intermediate school district by a federal, state, or local
governmental entity that performed a request for information,
request for proposal, or formal competitive bid process or by a
nonprofit corporation or nonprofit association that performed a
request for information, request for proposal, or formal
competitive bid process.
(b) "Family member" means a person's spouse or spouse's
sibling or child; a person's sibling or sibling's spouse or child;
a person's child or child's spouse; or a person's parent or
parent's spouse, and includes these relationships as created by
adoption or marriage.
(c) "Total budget" means budget for all funds held by the
intermediate school district.
Sec. 622a. (1) In addition to the annual financial audit
required under section 622, an intermediate school district is
subject to an audit of the matters described in this section
conducted by an independent auditor under the direction of the
department of treasury under this section. An audit conducted under
this section shall be based in part on an examination of an
intermediate school district's accounts, financial records, and
accounting procedures and shall address at least 3 of the following
aspects of the intermediate school district's operations, as
directed by the department of treasury:
(a) Whether intermediate school board members, intermediate
school district administrators, and intermediate school district
employees are adhering to ethics policies adopted by the
intermediate school board or required by state law.
(b) Whether intermediate school board members, intermediate
school district administrators, and intermediate school district
employees are adhering to conflict of interest policies adopted by
the intermediate school board or required by state law. This
includes, but is not limited to, policies and practices with regard
to contracts in which an intermediate school board member, an
intermediate school district administrator, or an intermediate
school district employee who is involved in the contracting
process, or a family member of an intermediate school board member,
an intermediate school district administrator, or an intermediate
school district employee who is involved in the contracting
process, has a substantial conflict of interest; and policies and
practices with regard to an intermediate school district
administrator negotiating, handling, presenting, or recommending a
contract in which the administrator or a family member of the
administrator has a substantial conflict of interest. As used in
this subdivision, "substantial conflict of interest" means that
term as defined in section 634(5).
(c) Whether a modification to an existing contract was made
during the audit period that resulted in an additional financial
obligation to the intermediate school district and the modification
was not competitively bid. As used in this subdivision,
"competitively bid" means that a contract was entered into through
a request for information, a request for proposal, or a formal
competitive bid process that was advertised and open to the public,
and includes a contract entered into on behalf of the intermediate
school district by a federal, state, or local governmental entity
that performed a request for information, request for proposal, or
formal competitive bid process or by a nonprofit corporation or
nonprofit association that performed a request for information,
request for proposal, or formal competitive bid process.
(d) Whether the intermediate school district's policies and
practices for responding to requests received under the freedom of
information act, 1976 PA 442, MCL 15.231 to 15.246, and the
intermediate school district's actual responses to requests made
during the audit period under that act, were in compliance with
that act. This part of the audit shall include, but is not limited
to, an examination of whether the costs charged for responding to
requests exceeded the costs permitted under that act.
(e) Whether intermediate school board members, intermediate
school district administrators, and intermediate school district
employees are adhering to travel guidelines and practices adopted
by the intermediate school board or required by state law.
(f) Whether the intermediate school district has accurately
accounted for and reported all information relating to stipends,
salaries, benefits, or other compensation paid to intermediate
school district administrators.
(g) Whether the intermediate school district has used public
funds in violation of law to pay for food, gifts, or other items
that are not used for instructional purposes, as defined by the
intermediate school board.
(h) Whether proceeds from a tax levied under section 681 for
area vocational-technical education operating purposes or from a
tax levied under section 1724a for special education operating
purposes have been expended for a purpose other than the purpose
for which the tax was levied.
(2) The department of treasury shall direct the random audits
of intermediate school districts under this section as follows:
(a) The department of treasury shall select the intermediate
school districts to be audited under this section on a random
basis.
(b) The department of treasury shall announce between July 1
and July 15 of each calendar year the intermediate school districts
that will be subject that year to an audit under this section for
the immediately preceding school fiscal year.
(c) The department of treasury shall select 5 intermediate
school districts for audit under this section every 2 years.
(d) Upon request by the department of treasury, the
intermediate school district shall notify the department of
treasury of the name, address, and contact person of the
independent auditor selected by the intermediate school board to
perform the annual financial audit for the intermediate school
district. The department of treasury shall enter into an agreed-
upon procedures agreement with the selected independent auditor,
identifying the matters to be audited and establishing the rate of
payment, which shall be no more than the rate the department would
charge for the same type of audit. The department of treasury shall
oversee the conduct of the audit by the independent auditor to the
extent the department of treasury considers necessary to meet the
purposes of this section.
(e) An intermediate school board and intermediate school
district officials shall provide all information requested by the
independent auditors or the department of treasury and shall
cooperate with them to the fullest extent possible.
(f) The independent auditor shall submit an audit report of
the audit to the center for educational performance and information
in the form and manner prescribed by the center for educational
performance and information. The center for educational performance
and information shall submit a copy of the audit report of each
audit conducted under this section to the department of treasury,
to the applicable intermediate school board, to the senate and
house standing committees having jurisdiction over education
legislation, to the department, and, subject to subdivision (g), to
the attorney general if the department of treasury considers it
appropriate.
(g) If the department of treasury determines that an audit
conducted under this section has disclosed that the intermediate
school board or any intermediate school district official or
employee has violated any state law governing the financial
operations of an intermediate school district, the department of
treasury shall notify the intermediate school district of that
determination. If the intermediate school district disputes the
determination or claims that the situation has been corrected,
within 15 days after receipt of the determination the intermediate
school district may submit an appeal of the determination to the
department of treasury. Within 90 days after receipt of the appeal,
the department of treasury shall consider the appeal and make a
determination of whether the initial determination was correct or
incorrect and of whether the situation has been corrected. If the
department of treasury finds that the initial determination was
correct and that the situation has not been corrected, then the
department of treasury shall file a copy of the report with the
attorney general. The attorney general shall review the report and,
if the attorney general considers it appropriate, shall either
commence appropriate proceedings against the intermediate school
board
or the official or employee or direct
refer the matter to
the prosecuting attorney for the county in which the violations
occurred and encourage that prosecuting attorney to commence
appropriate proceedings against the intermediate school board or
the
official or employee. These proceedings
shall should include
at least a civil action in a court of competent jurisdiction for
the recovery of any public money determined by the audit to have
been illegally expended and for the recovery of any public property
determined by the audit to have been converted or misappropriated.
(3) In addition to the intermediate school districts selected
for a random audit under subsection (2), the department of treasury
may also direct an audit under this section of 1 or more additional
intermediate school districts selected by the department of
treasury if the department of treasury considers that additional
audit or audits to be appropriate. Subsection (2)(d), (e), (f), and
(g) applies to an audit under this subsection.
(4) The department and the department of treasury, in
consultation with intermediate school districts, shall develop and
make available to intermediate school districts the auditing
criteria to be used for the purposes of this section.
(5) An audit under this section shall be performed in
accordance with standards issued by the American institute of
certified public accountants and with government audit standards
issued by the United States general accounting office.
(6) The department of treasury shall pay the costs of the
audit conducted under this section. The department of treasury's
obligation under this section is limited to the amount of a
separate line item appropriation identified for the purpose of
funding the department of treasury's duties under this section and
included in the annual appropriations act making appropriations for
the department of treasury.
(7) The department shall post on its website the audit reports
it receives under subsection (2)(f).
Sec. 623a. (1) An intermediate school board shall adopt
written policies governing the procurement of supplies, materials,
and equipment.
(2) Except as otherwise provided in subsection (3), an
intermediate school district shall not purchase an item or a group
of
items purchased in a single transaction costing $17,932.00
$18,490.00 or more unless competitive bids are obtained for those
items and the purchase of those items is approved by the
intermediate school board. The maximum amount specified in this
section shall be adjusted each year by multiplying the amount for
the immediately preceding year by the percentage by which the
average consumer price index for all items for the 12 months ending
August 31 of the year in which the adjustment is made differs from
that index's average for the 12 months ending on August 31 of the
immediately preceding year and adding that product to the maximum
amount that applied in the immediately preceding year, rounding to
the nearest whole dollar.
(3) An intermediate school district is not required to obtain
competitive bids for items purchased through the cooperative bulk
purchasing program operated by the department of management and
budget under section 263(3) of the management and budget act, 1984
PA 431, MCL 18.1263.
Sec. 634. (1) Not later than July 1, 2005, each intermediate
school board shall adopt and implement a conflict of interest
policy designed to avoid conflicts of interest by intermediate
school district officials and employees.
(2) Not later than July 1, 2005, each intermediate school
board shall adopt and implement a policy to prohibit use of
intermediate school district funds or other public funds under the
control of the intermediate school district for purchasing
alcoholic beverages, jewelry, gifts, fees for golf, or any item the
purchase or possession of which is illegal. Subject to subsection
(8), the policy may allow the use of public funds for the purchase
of a plaque, medal, trophy, or other award for the recognition of
an employee, volunteer, or pupil if the purchase does not exceed
$100.00 per recipient. As used in this subsection, "public funds"
means funds generated from taxes levied under this act, state
appropriations of state or federal funds, or payments made to the
intermediate school district for services by a constituent district
or any other person, but does not include voluntary contributions
made for a specific purpose by an intermediate school board member,
an intermediate school district employee, another individual, or a
private entity.
(3) The department shall develop and distribute to
intermediate school districts a model conflict of interest policy
for the purposes of subsection (1) and a model policy meeting the
requirements of subsection (2).
(4) Subject to subsection (8), in any 1-month period, an
intermediate school board member or intermediate school district
administrator shall not accept from a person who does business or
seeks to do business of any kind with the intermediate school
district any money, goods, or services with a value in excess of
$44.00 if the board member or administrator does not provide goods
or services of equal value in exchange. This subsection does not
apply
to a either
of the following:
(a) A gift or reward already prohibited under section 1805.
(b) A breakfast, luncheon, dinner, or other refreshment
consisting of food or beverage for immediate consumption.
(5) If an intermediate school board member or intermediate
school district administrator has a substantial conflict of
interest in a proposed contract, the intermediate school board
shall not enter into that contract. As used in this subsection,
"substantial conflict of interest" means a conflict of interest on
the part of an intermediate school board member or intermediate
school district administrator in respect to a contract with the
intermediate school district that is of such substance as to induce
action on his or her part to promote the contract for his or her
own personal benefit. In the following cases, there is no
substantial conflict of interest:
(a) A contract between the intermediate school district and
any of the following:
(i) A corporation in which an intermediate school board member
or intermediate school district administrator is a stockholder
owning 1% or less of the total stock outstanding in any class if
the stock is not listed on a stock exchange or owning stock that
has a present market value of $25,000.00 or less if the stock is
listed on a stock exchange.
(ii) A corporation in which a trust, if an intermediate school
board member or intermediate school district administrator is a
beneficiary under the trust, owns 1% or less of the total stock
outstanding in any class if the stock is not listed on a stock
exchange or owns stock that has a present market value of
$25,000.00 or less if the stock is listed on a stock exchange.
(iii) A professional limited liability company organized
pursuant to the Michigan limited liability company act, 1993 PA 23,
MCL
450.5101 to 450.6200 450.5200, if an
intermediate school
board member or intermediate school district administrator is an
employee but not a member of the company.
(b) A contract between the intermediate school district and
any of the following:
(i) A corporation in which an intermediate school board member
or intermediate school district administrator is not a director,
officer, or employee.
(ii) A firm, partnership, or other unincorporated association,
in which an intermediate school board member or intermediate school
district administrator is not a partner, member, or employee.
(iii) A corporation or firm that has an indebtedness owed to an
intermediate school board member or intermediate school district
administrator.
(c) A contract between the intermediate school district and a
constituent district.
(d) A contract awarded to the lowest qualified bidder, upon
receipt of sealed bids pursuant to a published notice for bids if
the notice does not bar, except as authorized by law, any qualified
person, firm, corporation, or trust from bidding. This subdivision
does not apply to amendments or renegotiations of a contract or to
additional payments under the contract that were not authorized by
the contract at the time of award.
(6) If an intermediate school board member, intermediate
school district administrator, or an employee of an intermediate
school district who recommends, negotiates, or is authorized to
sign a contract on behalf of the intermediate school district
either is employed by or under contract with a business enterprise
with which the intermediate school district is considering entering
into a contract or knows that he or she has a family member who has
an ownership interest in or is employed by a business enterprise
with which the intermediate school district is considering entering
into a contract, the board member, administrator, or employee shall
disclose this fact to the intermediate school board at a public
meeting of the intermediate school board before the intermediate
school board enters into the contract. If the intermediate school
board receives a disclosure described in this subsection, the
intermediate school board shall vote at a public meeting of the
intermediate school board on whether or not it considers the
relationship described in the disclosure to be a conflict of
interest, and shall not enter into the contract without first
voting at a public meeting of the intermediate school board to
enter into the contract. As used in this subsection, "family
member" means a person's spouse or spouse's sibling or child; a
person's sibling or sibling's spouse or child; a person's child or
child's spouse; or a person's parent or parent's spouse, and
includes these relationships as created by adoption or marriage.
(7) An intermediate school board shall ensure that each
employment contract with a school administrator employed by the
intermediate school district includes both a provision prohibiting
the school administrator from engaging in conduct involving moral
turpitude and a provision allowing the intermediate school board to
void the contract if the school administrator violates the
provision prohibiting conduct involving moral turpitude.
(8) Beginning January 1, 2005, the monetary amounts specified
in subsections (2) and (4) shall be adjusted each January 1 by
multiplying the amount for the immediately preceding year by the
percentage by which the average consumer price index for all items
for the 12 months ending August 31 of the year in which the
adjustment is made differs from that index's average for the 12
months ending on August 31 of the immediately preceding year and
adding that product to the maximum amount that applied in the
immediately preceding year, rounding to the nearest whole dollar.
The adjustment shall apply only to expenditures or violations
occurring after the date of the adjusting of the amount. The
adjusted amount shall be determined and announced by the department
on or before December 15 of each year and shall be provided to all
persons requesting the adjusted amount. If the index is
unavailable, the department shall make a reasonable approximation.
Sec. 1267. (1) Before commencing construction of a new school
building, or addition to or repair or renovation of an existing
school building, except repair in emergency situations, the board
of a school district or intermediate school district or board of
directors of a public school academy, shall obtain competitive bids
on all the material and labor required for the complete
construction of a proposed new building or addition to or repair or
renovation of an existing school building.
(2) The board, intermediate school board, or board of
directors shall advertise for the bids required under subsection
(1) by placing an advertisement for bids at least once in a
newspaper of general circulation in the area where the building or
addition is to be constructed or where the repair or renovation of
an existing building is to take place and by posting an
advertisement for bids for at least 2 weeks on the department of
management and budget website on a page on the website maintained
for this purpose or on a website maintained by a school
organization and designated by the department of management and
budget for this purpose. If the department of management and budget
designates a school organization website for this purpose, the
department of management and budget shall indicate this fact on its
website and include a link on its website to the school
organization website.
(3) The advertisement for bids shall do all of the following:
(a) Specify the date and time by which all bids must be
received by the board, intermediate school board, or board of
directors.
(b) State that the board, intermediate school board, or board
of directors will not consider or accept a bid received by the
board, intermediate school board, or board of directors after the
date and time specified for bid submission.
(c) Identify the time, date, and place of a public meeting at
which the board, intermediate school board, or board of directors
or its designee will open and read aloud each bid received by the
board, intermediate school board, or board of directors by the date
and time specified in subdivision (a).
(d) State that the bid shall be accompanied by a sworn and
notarized statement disclosing any familial relationship that
exists between the owner or any employee of the bidder and any
member of the board, intermediate school board, or board of
directors or the superintendent of the school district,
intermediate superintendent of the intermediate school district, or
chief executive officer of the public school academy. A board,
intermediate school board, or board of directors shall not accept a
bid that does not include this sworn and notarized disclosure
statement.
(4) The board, intermediate school board, or board of
directors shall require each bidder for a contract under this
section to file with the board, intermediate school board, or board
of directors security in an amount not less than 1/20 of the amount
of the bid conditioned to secure the school district from loss or
damage by reason of the withdrawal of the bid or by the failure of
the bidder to enter a contract for performance, if the bid is
accepted by the board, intermediate school board, or board of
directors.
(5) The board, intermediate school board, or board of
directors shall not open, consider, or accept a bid that the board,
intermediate school board, or board of directors receives after the
date and time specified for bid submission in the advertisement for
bids described in subsection (3).
(6) At a public meeting identified in the advertisement for
bids described in subsection (3), the board, intermediate school
board, or board of directors or its designee shall open and read
aloud each bid that the board, intermediate school board, or board
of directors received at or before the time and date for bid
submission specified in the advertisement for bids. The board,
intermediate school board, or board of directors may reject any or
all bids, and if all bids are rejected, shall readvertise in the
manner required by this section.
(7) This section does not apply to buildings, renovations, or
repairs
costing less than $17,932.00 $18,490.00 or to repair
work
normally performed by school district, intermediate school board,
or public school academy employees. The maximum amount specified in
this subsection shall be adjusted each year by multiplying the
amount for the immediately preceding year by the percentage by
which the average consumer price index for all items for the 12
months ending August 31 of the year in which the adjustment is made
differs from that index's average for the 12 months ending on
August 31 of the immediately preceding year and adding that product
to the maximum amount that applied in the immediately preceding
year, rounding to the nearest whole dollar.
Sec. 1274. (1) The board of a school district or board of
directors of a public school academy shall adopt written policies
governing the procurement of supplies, materials, and equipment.
(2) Except as otherwise provided in subsection (3), a school
district or public school academy shall not purchase an item or a
group
of items in a single transaction costing $17,932.00
$18,490.00 or more unless competitive bids are obtained for those
items and the purchase of those items is approved by the school
board or board of directors. The maximum amount specified in this
subsection shall be adjusted each year by multiplying the amount
for the immediately preceding year by the percentage by which the
average consumer price index for all items for the 12 months ending
August 31 of the year in which the adjustment is made differs from
that index's average for the 12 months ending on August 31 of the
immediately preceding year and adding that product to the maximum
amount that applied in the immediately preceding year, rounding to
the nearest whole dollar.
(3) A school district or public school academy is not required
to obtain competitive bids for items purchased through the
cooperative bulk purchasing program operated by the department of
management and budget under section 263(3) of the management and
budget act, 1984 PA 431, MCL 18.1263.
(4) The board of a school district or local act school
district or board of directors of a public school academy may
acquire by purchase, lease, or rental, with or without option to
purchase, equipment necessary for the operation of the school
program, including, but not limited to, heating, water heating, and
cooking equipment for school buildings, and may pay for the
equipment from operating funds of the district or public school
academy. Heating and cooking equipment may be purchased on a title
retaining contract or other form of agreement creating a security
interest and pledging in payment money in the general fund or funds
received from state school aid. The contracts may extend for not
more than 10 years.
Enacting section 1. Sections 620 and 622a of the revised
school code, 1976 PA 451, MCL 380.620 and 380.622a, as amended by
this amendatory act, take effect July 1, 2006.