January 25, 2006, Introduced by Senators JELINEK, ALLEN, GARCIA, SWITALSKI and BIRKHOLZ and referred to the Committee on Appropriations.
A bill to amend 2005 PA 92, entitled
"School bond qualification, approval, and loan act,"
by amending section 9 (MCL 388.1929).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 9. (1) Except as otherwise provided in this act, a school
district may borrow from the state an amount not greater than the
difference between the proceeds of the school district’s computed
millage and the amount necessary to pay principal and interest on
its qualified bonds, including any necessary allowances for
estimated tax delinquencies.
(2) For school districts having qualified loans outstanding as
of the
effective date of this act July 20, 2005,
the state
treasurer shall review information relating to each school district
regarding the taxable value of the school district and the actual
debt
service of outstanding qualified bonds as of the effective
date
of this act July 20, 2005 and shall issue an order
establishing the payment date for all those outstanding qualified
loans and any additional qualified loans expected to be incurred by
those
school districts related to qualified bonds issued before
the
effective date of this act July 20, 2005.
The payment date
shall be not later than 72 months after the date on which the
qualified bonds most recently issued by the school district are due
and payable.
(3) For qualified loans related to qualified bonds issued
after the
effective date of this act July 20, 2005,
the qualified
loans shall be due not later than 72 months after the date on which
the qualified bonds for which the school borrowed from this state
are due and payable. This section does not preclude early repayment
of qualified bonds or qualified loans.
(4) Except with regard to qualified loans described in
subsection (2), each loan made or considered made to a school
district under this act shall be for debt service on only a
specific qualified bond issue. The state treasurer shall maintain
separate accounts for each school district on the books and
accounts of this state noting the qualified bond, the related
qualified loans, the final payment date of the bonds, the final
payment date of the qualified loans, and the interest rate accrued
on the loans.
(5) For qualified loans relating to qualified bonds issued
after the
effective date of this act July 20, 2005,
a school
district shall continue to levy the computed mills until it has
completely repaid all principal and interest on its qualified
loans.
(6) For qualified loans relating to qualified bonds issued
before the
effective date of this act July 20, 2005,
a school
district shall continue to comply with the levy and repayment
requirements
imposed before the effective date of this act July
20,
2005. Not less than 90 days after the
effective date of this
act
July 20, 2005, the
state treasurer and the school district
shall enter into amended and restated repayment agreements to
incorporate the levy and repayment requirements applicable to
qualified
loans issued before the effective date of this act July
20, 2005.
(7) Upon the request of a school district made before June 1
of any year, the state treasurer annually may waive all or a
portion of the millage required to be levied by a school district
to pay principal and interest on its qualified bonds or qualified
loans under this section if the state treasurer finds all of the
following:
(a) The school board of the school district has applied to the
state treasurer for permission to levy less than the millage
required to be levied to pay the principal and interest on its
qualified bonds or qualified loans under subsection (1).
(b) The application specifies the number of mills the school
district requests permission to levy.
(c) The waiver will be financially beneficial to this state,
the school district, or both.
(d) The waiver will not reduce the millage levied by the
school district to pay principal and interest on qualified bonds or
qualified loans under this act to less than 7 mills.
(e) The board of the school district, by resolution, has
agreed to comply with all conditions that the state treasurer
considers necessary.
(8) Except as otherwise provided in this act, loans shall bear
interest at the greater of 3% or the average annual cost of funds
computed annually on the basis of all state general obligations
issued under section 16 of article IX of the state constitution of
1963 plus 0.125%. In the event this state has no outstanding
general obligations under section 16 of article IX of the state
constitution of 1963, the average annual cost of funds shall be
computed on the basis of all state general obligations issued under
section 15 of article IX of the state constitution of 1963 plus
0.125%.