April 27, 2006, Introduced by Reps. Elsenheimer, Mortimer, Taub, Palmer, Hoogendyk, Hummel, Walker, Sheltrown, Emmons, Casperson and Marleau and referred to the Committee on Higher Education and Career Preparation.
A bill to amend 1931 PA 327, entitled
"An act to provide for the organization, regulation and
classification of corporations; to provide their rights, powers and
immunities; to prescribe the conditions on which corporations may
exercise their powers; to provide for the inclusion of certain
existing corporations within the provisions of this act; to
prescribe the terms and conditions upon which foreign corporations
may be admitted to do business within this state; to require
certain annual reports to be filed by corporations; to prescribe
penalties for the violations of the provisions of this act; and to
repeal certain acts and parts of acts relating to corporations,"
by amending sections 171, 172, and 185 (MCL 450.171, 450.172, and
450.185).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec.
171. (1) For the purposes of this act, an
educational
corporations
shall be corporation is classified as follows 1 of
the following:
(w)
Those having
(a) Except for an educational corporation described in
subdivision (b), an educational corporation that is 1 of the
following:
(i) Class w - has a capital of
not less than $500,000.00 ;
and less than $1,000,000.00.
(ii) (x)
Those having Class x - has a capital of not less
than
$100,000.00 , and less than $500,000.00, ; or is an
institution known as a kindergarten institution formed under former
1913 PA 359.
(iii) (y)
Those having Class y - has a capital of at least
$1,000,000.00. or
more;
(b)
(z) Those instituted and maintained
Class z - an
educational corporation organized and operated by any
ecclesiastical or religious order, society, corporation, or
corporations,
retaining or by a church,
that retains control of
such
the institution for
denominational purposes. Class z
includes, but is not limited to, all of the following:
(i) A school, academy, or college founded under former 1899 PA
135 and known under that act as an "Ursuline academy".
(ii) A school, academy, or college founded under former 1915 PA
121 and known under that act as an "ecclesiastical seminary".
(iii) A school, academy, or college founded under former 1901 PA
28 and known under that act as an "Evangelical Lutheran deaf mute
institution".
(iv) A school, academy, or college founded under former 1867 PA
135 and known under that act as an "industrial and charitable
school".
(v) A school, academy, or college organized under paragraph
(c), subdivision 1, chapter 2, part 4, of former 1921 PA 84.
(vi) A school, college, institution, or educational program of
like character and purpose to an educational corporation, school,
academy, or college described in this subdivision and formed under
any law of this state for educational purposes.
(2) Every
educational corporation, before Before
being
authorized
to file its articles, shall be an educational
corporation classified as class w, x, or y under subsection (1) is
required
to present a statement in writing to the Michigan
corporation
and securities commission in writing department of
labor
and economic growth from the state
board of education that
(1)
the confirms all of the following:
(a)
The housing space and administration
facilities which
that it possesses or proposes to provide for its declared field or
fields
of education are adequate. , (2) its
(b) Its proposed educational program leading to the diplomas
or
degrees which it proposes to offer is adequate. , (3) its
(c) The laboratory,
library, and other teaching facilities
which
that it possesses or
proposes to provide are adequate. ,
(4)
it
(d) It has or proposes to employ an adequate staff, fully
trained,
for the instruction proposed. , and (5) at
(e) At least 50% of its capital, whether consisting of stock
or in gifts, devises, legacies, bequests, or other contributions of
money
or property, has been paid in or reduced to is in its
possession.
(3) In determining whether any educational corporation
satisfies
conditions specified in classes (w), (x), (y) and (z) of
this
section the capital requirement for classification as
class
w, x, or y under subsection (1), the state board of education may
treat
as a credit to the capital of such the corporation the
guaranteed annual income of that corporation to the extent that it
deems
such the guaranteed income the equivalent of all or any
part of the required endowment.
(4) The use of the word "college" or "university" in the name
of
any group, organization, or association hereafter formed after
the effective date of this act in this state is limited to those
educational
corporations complying with the requirements for class
(w)
or class (y) educational corporations or to such educational
corporations
of class (z) as shall satisfy the requirements set up
for
class (y) corporations: Provided, however, That the
classification as class w, y, or z under subsection (1). The words
"junior
college" may be used by
those educational corporations of
class
(x). Whenever complying with the requirements for
classification
as class x under subsection (1). If
this provision
subsection is violated, it shall be the duty of the prosecuting
attorney
, in the county where the organization is located , to
shall bring proceedings to enjoin the further use of such
a name
in
violation of this act subsection.
(5) No
An educational corporation classified as class w, y,
or
z under subsection (1) shall be
permitted to not expand its
program
beyond that specified in its articles of incorporation
until
unless it has presented to
the Michigan corporation and
securities
commission department of labor and economic growth a
statement in writing from the state board of education approving
the facilities, equipment, and staff or the proposed facilities,
equipment, and staff as adequate for the offering of the additional
educational program.
Sec.
172. (1) (a) Educational corporations of class (w) as
defined
in section 171 of this act shall have authority to An
educational corporation classified as class w under section 171(1)
may establish and conduct general colleges a general college for
furnishing
higher learning and to confer such any degrees and
honors
as shall be approved by the state board of education prior
to
the filing of articles of incorporation. ; and For purposes of
this
section, the term "college" as
herein used shall be construed
to
include includes
a preparatory school or any college,
university, or other institution where the arts, sciences,
professions, and
higher learning are taught and degrees and honors
therein
in those areas are conferred. Such
colleges may also
include
preparatory schools as commonly understood;
(2) (b)
Educational corporations of class (x), as defined in
section
171, shall have authority to An educational corporation
classified as class x under section 171(1) may establish and
conduct a
junior colleges, seminaries, academies college,
seminary,
academy, or preparatory schools school,
as determined
and
approved by the state board of education, but not a general
colleges
or universities as defined college or university
described in subsection (a) hereof; (1).
(3)
(c) Educational corporations of class (z) as defined in
said
section 171 shall embrace such schools, academies, or colleges
as
have been heretofore founded under Act 135, Public Acts 1899,
known
thereunder as "Ursuline academies"; those founded under Act
121,
Public Acts 1915, and known thereunder as "ecclesiastical
seminaries";
those founded under Act 28, Public Acts 1901, and
known
thereunder as "Evangelical Lutheran deaf mute institutions";
those
founded under Act 135, Public Acts 1867, known as "industrial
and
charitable schools"; those organized under paragraph (c),
subdivision
1, chapter 2, part 4, of Act 84, Public Acts 1921, and
such
other schools, colleges and institutions of like character and
purpose
as may be formed under any law of this state for
educational
purposes shall have An educational corporation
classified as class w, x, y, or z under section 171(1) and formed
under another act or former act of this state has all the rights,
powers, privileges, and immunities enjoyed under its act of
incorporation and without regard to the classification made in this
act,
and upon complying with the provisions hereof shall have
such
of this act has any
additional rights, powers, privileges,
and
immunities as are conferred hereunder under this act
according
to the classifications prescribed in this act: Provided
further,
That any corporation heretofore formed under Act 359,
Public
Acts 1913, and known thereunder as "kindergarten
institutions"
shall hereafter be classified under class (x) of
sections
171 and 172 of this act: Provided further, That any
corporation
of class (z) hereafter organized under this act may
enjoy
its classification under section 171(1).
(4) An educational corporation classified as class z under
section 171(1) and organized under this act has the privileges
provided
under classes (w), (x) and (y) of section 171, on
condition
that it satisfies the requirements set up for
corporations
of these respective classes to an educational
institution classified as class w, x, or y.
(5) (d)
Educational corporations of class (y) as defined in
section
171 shall have authority to An educational institution
classified as class y under section 171(1) may establish and
conduct
colleges or universities a
college or university of a
graduate rank with programs of studies of 5 years or more.
Sec.
185. Same; powers of churches not restricted. Nothing in
this
act contained shall be construed as limiting or restricting
This act does not limit or restrict the rights, powers, privileges,
immunities, or the
practices of any church heretofore
established or incorporated under any law of this state before the
effective
date of this section; nor as
requiring any such does
not
require that a church to
alter or change any rule of
discipline, custom, or usage in respect of its church policy or
government;
nor as interfering and
does not interfere with the
lawful acquisition, use, operation, or disposition of any property
now
owned or held by any such church corporation that church,
including, but not limited to, the formation and operation of an
educational institution or program classified as class z under
section 171(1) or the grant of a degree, diploma, or certificate by
that educational institution. The provisions of this act relating
to ecclesiastical corporations shall be liberally construed in the
interests of religion and morality.
Enacting section 1. This amendatory act does not take effect
unless all of the following bills of the 93rd Legislature are
enacted into law:
(a) Senate Bill No.____ or House Bill No. 6015(request no.
05578'05).
(b) Senate Bill No.____ or House Bill No. 6016(request no.
05579'05).