HB-5690, As Passed House, November 13, 2008

SUBSTITUTE FOR

HOUSE BILL NO. 5690

A bill to create and provide for the incorporation of certain

regional convention facility authorities; to provide for the

membership of the authorities; to provide for the powers and duties

of the authorities; to provide for the conveyance of ownership of

and operational jurisdiction over certain convention facilities to

authorities and to provide for the transfer of certain real and

personal property utilized as convention facilities to authorities;

to provide for the assumption of certain contracts, bonds, notes,

and other evidences of indebtedness and liabilities related to

convention facilities by authorities; to authorize the creation of

certain funds; to authorize expenditures from certain funds; to

finance the acquisition of land and the development of certain

convention facilities and of public improvements or related

facilities; to provide for the issuance of bonds and notes; to

authorize certain investments; to provide for the transfer of

public employees to the employment of authorities; to provide for

the allocation of liabilities related to employee benefits; to

protect certain rights of local government employees; and to impose

certain powers and duties upon state and local departments,

agencies, and officers.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 1. This act shall be known and may be cited as the

"regional convention facility authority act".

Sec. 3. The legislature finds and declares all of the

following:

(a) That there exists in this state a continuing need to

strengthen and revitalize the economy of this state and of local

units of government in this state and that it is in best interests

of this state and local units of government in this state to

promote tourism and convention business in order to assist in the

prevention of unemployment and the alleviation of the conditions of

unemployment, to preserve existing jobs, to facilitate economic

development, and to create new jobs to meet employment demands.

(b) That it is necessary for the promotion of general welfare

and a valid public purpose to assist and encourage the acquisition,

construction, improvement, enlargement, renewal, replacement,

repairing, financing, furnishing, and equipping of regional

convention facilities and the real property on which they are

located, to refinance these activities, and to enter into contracts

and procure services necessary and appropriate for the development

and ongoing management and operation of regional convention

facilities in an efficient and effective manner.

under this act and the powers conferred by this act constitute a

necessary program and serve a necessary public purpose.

Sec. 5. As used in this act:

(a) "Authority" means a regional convention facility authority

created under section 7.

(b) "Board" means the board of directors of an authority.

combination of, a convention hall, auditorium, arena, meeting

rooms, exhibition area, and related adjacent public areas that are

generally available to the public for lease on a short-term basis

for holding conventions, meetings, exhibits, entertainment, and

similar events, together with real or personal property, and

easements above, on, or under the surface of real or personal

property, used or intended to be used for holding conventions,

meetings, exhibits, entertainment, and similar events, together

with appurtenant property, including covered walkways, parking

lots, or structures, necessary and convenient for use in connection

with the convention facility. Convention facility includes any

contiguous arena used for sporting events.

(d) "Develop" means to plan, acquire, construct, improve,

enlarge, maintain, renew, renovate, repair, replace, lease, equip,

furnish, market, promote, manage, or operate.

(e) "Fiscal year" means an annual period that begins on July 1

and ends on June 30 or the fiscal year for an authority established

by the board of the authority.

(f) "Legislative body" means the elected body of a local

government possessing the legislative power of the local

government.

(g) "Local chief executive officer" means the mayor or city

manager of a city or the county executive of a county or, if a

county does not have a county executive, the chairperson of the

county board of commissioners.

(h) "Local government" means a county or city.

(i) "Qualified city" means a city with a population of more

than 750,000 according to the most recent decennial census that

contains a qualified convention facility.

(j) "Qualified county" means a county that contains a

qualified city.

(k) "Qualified convention facility" means a publicly owned

convention facility that includes at least 600,000 square feet of

usable exhibition area and that is contiguous to an arena.

(l) "Qualified metropolitan area" means a geographic area of

this state that includes a qualified city, a qualified county, and

the 2 counties bordering the qualified county with the largest

populations according to the most recent decennial census.

(m) "Transfer date" means the date 90 days after the creation

of an authority under section 7 on which the right, title,

interest, ownership, and control of a qualified convention facility

are conveyed and transferred from a qualified city to an authority.

Sec. 7. (1) For an area of this state that is a qualified

metropolitan area on the effective date of this act, an authority

is created for the qualified metropolitan area on the effective

date of this act. For an area of this state that becomes a

qualified metropolitan area after the effective date of this act,

an authority is created for the qualified metropolitan area on the

date the area became a qualified metropolitan area. An authority

created under this section shall be a public body corporate and

politic and a metropolitan authority authorized by section 27 of

article VII of the state constitution of 1963 and shall possess the

powers, duties, and jurisdictions vested in the authority under

this act and other laws. The name of an authority created under

this section shall include the name of the qualified city located

within the qualified metropolitan area and the phrase "regional

convention facility authority".

(2) Before the transfer date, an authority may organize and

exercise all powers, duties, and jurisdictions granted under this

act, except the powers, duties, and jurisdictions related to the

management, operation, and development of a qualified convention

facility. On the transfer date, an authority is vested with the

additional powers, duties, and jurisdictions under this act related

to the management, operation, and development of a qualified

convention facility.

(3) It is the intent of the legislature that the transfer of a

qualified convention facility from a qualified city to an authority

under this act and any payment required under section 19(9)

represents at least a fair exchange of value for value for the

qualified city considering, without limitation, all of the

following:

(a) The net value of the qualified convention facility prior

to the transfer date after deducting deferred maintenance

obligations, operational deficits, repair or expansion needs, and

other liabilities related to the qualified convention facility that

are obligations of the qualified city.

(b) The benefits to the qualified city resulting from the

transfer of the qualified convention facility to the authority,

including, but not limited to, assumption or payment of debt

obligations of the qualified city by the authority, reductions in

costs, liabilities or other obligations of the qualified city,

additional revenues or other money not otherwise available for the

qualified convention facility, and the positive economic impact to

the qualified city likely to be generated by the operation of the

qualified convention facility by the authority or any expansion or

improvement of the qualified convention facility by the authority,

especially economic impact resulting in the creation or retention

of jobs and capital investment.

payable directly or indirectly to the qualified city after the

transfer date under this act, the state convention facility

development act, 1985 PA 106, MCL 207.621 to 207.640, or the health

and safety fund act, 1987 PA 264, MCL 141.471 to 141.479.

(4) The property of an authority created under this act is

public property devoted to an essential public and governmental

purpose. Income of the authority is for a public and governmental

purpose.

(5) Except as otherwise provided in this subsection, the

House Bill No. 5690 (H-2) as amended November 13, 2008

property of the authority created under this act and its income,

activities, and operations are exempt from all taxes and special

assessments of this state or a political subdivision of this state.

Property of an authority and its income, activities, and operations

that are leased to private persons are not exempt from any tax or

special assessment of this state or a political subdivision of this

state. Property of an authority is exempt from any ad valorem

property taxes levied under the general property tax act, 1893 PA

206, MCL 211.1 to 211.155, or other law of this state authorizing

the taxation of real or personal property. An authority is an

entity of government for purposes of section 4a(1)(a) of the

general sales tax act, 1933 PA 167, MCL 205.54a, and section 4h of

the use tax act, 1937 PA 94, MCL 205.94h.

(6) The validity of the creation of an authority shall be

conclusively presumed unless questioned in an original action filed

in the court of appeals within 60 days after the creation of the

authority under this section. The court of appeals has original

jurisdiction to hear an action under this subsection. The court

shall hear the action in an expedited manner. This state shall be a

necessary party in any action under this subsection.

Sec. 9. (1) An authority created under this act shall be

directed and governed by a board of directors consisting of [

] 7 members[.

House Bill No. 5690 (H-2) as amended November 13, 2008

]

(2) Board members appointed under this section shall possess

business, financial, or professional experience relevant to the

operation of a corporation or a convention facility. No board

member shall be an employee or officer of any local government or

of this state. For purposes of this subsection, "local government"

includes any county, township, city, village, or intergovernmental

entity in this state.

(3) Except as otherwise provided in this subsection, board

members shall be appointed for a term of 6 years. Initial

appointments under subsection (1) shall be made within 30 days of

the creation of the authority. Of the board members initially

appointed under subsection (1), the members appointed under

subsection (1)(a) and (c) shall be appointed for a term expiring on

the second August 31 following the creation of the authority, the

members appointed under subsection (1)(b) and (d) shall be

appointed for a term expiring on the third August 31 following the

creation of the authority, the member appointed under subsection

(1)(e) shall be appointed for a term expiring on the fourth August

31 following the creation of the authority, the member appointed

under subsection (1)(f) shall be appointed for a term expiring on

the fifth August 31 following the creation of the authority, and

the member appointed under subsection (1)(g) shall be appointed for

a term expiring on the sixth August 31 following the creation of

the authority. If a vacancy occurs on the board other than by

expiration of a term, the vacancy shall be filled in the same

manner as the original appointment for the remainder of the term.

Board members may continue to serve until a successor is appointed

and qualified.

(4) Each officer appointing a board member under this section

shall file the appointment with the secretary of state.

Notwithstanding any law or local charter provision to the contrary,

appointments by an officer are not subject to approval or rejection

by a legislative body.

(5) Upon appointment to a board under this section, and upon

taking and filing of the oath of office required by section 1 of

article XI of the state constitution of 1963, a board member shall

enter office and exercise the duties of the office of board member.

(6) Board members shall serve without compensation but may be

reimbursed for actual and necessary expenses incurred while

attending board meetings or performing other authorized official

business of the authority.

Sec. 11. (1) Within not more than 30 days following

appointment of a majority of the members of a board, the board

shall hold its first meeting at a date and time determined by the

individual appointed under section 9(1)(a). The board members shall

elect from among the board members an individual to serve as

chairperson of the board and may elect other officers as the board

considers necessary. All officers shall be elected annually by the

board.

(2) The business of the board shall be conducted at a public

meeting of the board held in compliance with the open meetings act,

1976 PA 267, MCL 15.261 to 15.275. Public notice of the time, date,

and place of the meeting shall be given in the manner required by

the open meetings act, 1976 PA 267, MCL 15.261 to 15.275. A board

shall adopt bylaws consistent with the open meetings act, 1976 PA

267, MCL 15.261 to 15.275, governing its procedures and the holding

of meetings. After organization, a board shall adopt a schedule of

regular meetings and adopt a regular meeting date, place, and time.

A special meeting of the board may be called by the chairperson of

the board or as provided in bylaws adopted by the board. Notice of

a special meeting shall be given in the manner required by the open

meetings act, 1976 PA 267, MCL 15.261 to 15.275.

(3) A board shall keep a written or printed record of each

meeting, which record and any other document or record prepared,

owned, used, in the possession of, or retained by the authority in

the performance of an official function shall be made available to

the public in compliance with the freedom of information act, 1976

PA 442, MCL 15.231 to 15.246.

(4) A board shall provide for a system of accounts for the

authority to conform to a uniform system required by law and for

the auditing of the accounts of an authority. The board shall

obtain an annual audit of the authority by an independent certified

public accountant and report on the audit and auditing procedures

in the manner provided by sections 6 to 13 of the uniform budgeting

and accounting act, 1968 PA 2, MCL 141.426 to 141.433. The audit

also shall be in accordance with generally accepted government

auditing standards.

(5) Before the beginning of each fisca l year, a board shall

cause to be prepared a budget for the authority containing an

itemized statement of the estimated current operational expenses

and the expenses for capital outlay including funds for the

operation and development of convention facilities under the

jurisdiction of the board, including the amount necessary to pay

the principal and interest of any outstanding bonds or other

obligations of the authority maturing during the next fiscal year

or that have previously matured and are unpaid, and an estimate of

the estimated revenue of the authority from all sources for the

next fiscal year. The board shall adopt a budget as for the fiscal

year in accordance with the uniform budget and accounting act, 1968

PA 2, MCL 141.421 to 141.440a.

(6) A board shall provide for the purchase of, the contracting

for, and the providing of supplies, materials, services, insurance,

utilities, third-party financing, equipment, printing, and all

other items as needed by the authority to efficiently and

effectively meet the needs of the authority. The authority shall

make all discretionary decisions concerning the solicitation,

award, amendment, cancellation, and appeal of authority contracts.

A board shall provide for the acquisition of professional services,

including, but not limited to, architectural services, engineering

services, surveying services, accounting services, and legal

services, in accordance with a competitive, qualifications-based

selection process and procedure for the type of professional

service required by the authority. An authority may enter into a

cooperative purchasing agreement with the federal government, this

state, or more other public entities for the purchase of goods or

services necessary for the authority. An authority may enter into

lease purchases or installment purchases for periods not exceeding

the anticipated useful life of the items purchased unless otherwise

prohibited by law. In all purchases made by the authority, all

other things being equal, preference shall be given first to

products manufactured or services offered by firms based in the

authority's qualified city and next to firms based in the qualified

metropolitan area, if consistent with federal law. Except as

otherwise provided in this section, the authority shall utilize

competitive solicitation for all purchases authorized under this

act unless 1 or more of the following apply:

(a) Procurement of goods or services is necessary for the

imminent protection of public health or safety or to mitigate an

imminent threat to public health or safety, as determined by the

authority or its chief executive officer.

(b) Procurement of goods or services is for emergency repair

or construction caused by unforeseen circumstances when the repair

or construction is necessary to protect life or property.

declared state of emergency or state of disaster under the

emergency management act, 1976 PA 390, MCL 30.401 to 30.421.

(d) Procurement of goods or services is in response to a

declared state of emergency under 1945 PA 302, MCL 10.31 to 10.33.

(e) Procurement of goods or services is in response to a

declared state of energy emergency under 1982 PA 191, MCL 10.81 to

10.89.

(f) Procurement of goods or services is under a cooperative

purchasing agreement with the federal government, this state, or

more public entities for the purchase of goods and services

necessary at fair and reasonable prices using a competitive

procurement method for authority operations.

(g) The value of the procurement is less than $25,000.00, and

the board has established policies or procedures to ensure that

goods or services with a value of less than $25,000.00 are

purchased by the board at fair and reasonable prices.

(7) A board may not enter into any cost plus construction

contract unless all of the following apply:

(a) The contract cost is less than $50,000.00.

(b) The contract is for emergency repair or construction

caused by unforeseen circumstances.

property.

(d) The contract complies with requirements of applicable

state or federal law.

(8) Subsections (6) to (7) shall not be construed to preclude

the award of a contract based upon qualifications or based upon

best value for the authority.

(9) A board may employ personnel as the board considers

necessary to assist the board in performing the power, duties, and

jurisdictions of the authority, including, but not limited to,

employment of a chief executive officer as authorized under section

13.

(10) A board shall establish policies to assure that the board

and the authority shall not do either of the following:

(a) Fail or refuse to hire, recruit, or promote; demote;

discharge; or otherwise discriminate against a person with respect

to employment, compensation, or a term, condition, or privilege of

employment, or a contract with the authority because of religion,

race, color, national origin, age, sex, sexual orientation, height,

weight, marital status, partisan considerations, or a disability or

genetic information that is unrelated to the person's ability to

perform the duties of a particular job, position, or contract.

(b) Limit, segregate, or classify an employee, a contractor,

or applicant for employment or a contract in a way that deprives or

tends to deprive the employee, contractor, or applicant of an

employment opportunity or otherwise adversely affects the status of

an employee, contractor, or applicant because of religion, race,

color, national origin, age, sex, sexual orientation, height,

weight, marital status, partisan considerations, or a disability or

genetic information that is unrelated to the person's ability to

perform the duties of a particular job or position.

Sec. 13. (1) A board may appoint and fix the compensation of a

chief executive officer for the authority. If the board appoints a

chief executive officer, the board shall prescribe the duties and

responsibilities of the chief executive officer in addition to any

duties and responsibilities imposed upon the chief executive

officer under this act. Action by the board to appoint a chief

executive officer under this section shall require the affirmative

vote of at least 5 board members. A chief executive officer of an

authority shall serve at the pleasure of the board, and the board

may remove or discharge the chief executive officer of the

authority by a vote of not less than 5 board members.

(2) A chief executive officer shall supervise, and be

responsible for, the day-to-day operation of the authority,

including the control, supervision, management, and oversight of

convention facilities, the issuance of bonds and notes approved by

the board, the negotiation and establishment of compensation and

other terms and conditions of employment for any employees of the

authority, the negotiation, supervision, and enforcement of

contracts entered into by the authority, and the supervision of

contractors of the authority in their performance of their duties.

A board may delegate to the chief executive officer of an authority

the power and responsibility to execute and deliver, and sign for,

contracts, leases, obligations, and other instruments as have been

approved by the board or for which power to approve has been

delegated to the chief executive officer of the authority.

(3) A chief executive officer of an authority shall have all

powers as are incident to the performance of his or her duties that

are prescribed by this act or by the board. All actions of the

chief executive officer of an authority shall be in conformance

with the policies of the board and in compliance with applicable

law.

Sec. 15. (1) A board member or an officer, employee, or agent

of an authority shall discharge the duties of his or her position

in a nonpartisan manner, in good faith, and with the degree of

diligence, care, and skill that an ordinarily prudent person would

exercise under similar circumstances in a like position. In

discharging his or her duties, a board member or an officer,

employee, or agent of an authority, when acting in good faith, may

rely upon any of the following:

(a) The opinion of counsel for the authority.

(b) The report of an independent appraiser selected by the

board.

member of the board, officer, employee, or agent to be correct by

the officer of the authority having charge of its books of account

or stated in a written report by the state auditor general or a

certified public accountant, or a firm of certified accountants, to

reflect the financial condition of the authority.

(2) A board shall organize and make its own policies and

procedures and shall adopt bylaws not inconsistent with this act

governing its operations. A majority of the members of a board

constitute a quorum for transaction of business, notwithstanding

the existence of 1 or more vacancies on the board. Except as

otherwise provided in this act, actions taken by the board shall

require the affirmative vote of at least 4 board members. The board

shall meet at the call of the chairperson and as may be provided in

the bylaws.

(3) A member of a board or an officer, appointee, or employee

of an authority shall not be subject to personal liability when

acting in good faith within the scope of his or her authority or on

account of liability of the authority, and the board may indemnify

a member of the board or an officer, appointee, or employee of the

authority against liability arising out of the discharge of his or

her official duties. An authority may indemnify and procure

insurance indemnifying members of the board and other officers and

employees of the authority from personal loss or accountability for

liability asserted by a person with regard to bonds or other

obligations of the authority, or from any personal liability or

accountability by reason of the issuance of the bonds or other

obligations or by reason of any other action taken or the failure

to act by the authority. The authority also may purchase and

maintain insurance on behalf of any person against any liability

asserted against the person and incurred by the person in any

capacity or arising out of the status of the person as a member of

the board or an officer or employee of the authority, whether or

not the authority would have the power to indemnify the person

against that liability under this section. An authority, pursuant

to bylaw, contract, agreement, or resolution of its board, may

obligate itself in advance to indemnify persons.

(4) Board members and officers and employees of an authority

are public servants subject to 1968 PA 317, MCL 15.321 to 15.330,

and are subject to any other applicable law with respect to

conflicts of interest. A board shall establish policies and

procedures requiring periodic disclosure of relationships which may

give rise to conflicts of interest. The board shall require that a

board member or chief executive officer of the authority with a

direct interest in any matter before the authority disclose the

board member's or officer's interest and any reasons reasonably

known to the board member or officer why the transaction may not be

in the best interest of the public or the authority before the

board takes any action with respect to the matter. The disclosure

shall become part of the record of an authority's proceedings.

(5) An authority shall establish an ethics manual governing

the conducting of authority business and the conduct of authority

officers and employees. An authority shall establish policies that

are no less stringent than those provided for public officers and

employees by 1973 PA 196, MCL 15.341 to 15.348, and coordinate

efforts for the authority to preclude the opportunity for and the

occurrence of transactions by the authority that would create a

conflict of interest involving board members and officers or

employees of the authority. At a minimum, the policies shall

include compliance by each board member and officer or employees

who regularly exercises significant discretion over the award and

management of authority procurements with policies governing all of

the following:

(a) Immediate disclosure of the existence and nature of any

financial interest that could reasonably be expected to create a

conflict of interest.

(b) Withdrawal by an employee, officer, or board member from

participation in or discussion or evaluation of any recommendation

or decision involving an authority procurement that would

reasonably be expected to create a conflict of interest for that

employee or member.

(6) The appointing authority of a board member may remove the

board member from office for gross neglect of duty, corrupt conduct

in office, or any other misfeasance or malfeasance in office.

Sec. 17. (1) Except as otherwise provided in this act, an

authority may do all things necessary or convenient to implement

the purposes, objectives, and provisions of this act and the

purposes, objectives, and jurisdictions vested in the authority or

the board by this act or other law, including, but not limited to,

all of the following:

(a) Adopt and use a corporate seal.

(b) Adopt, amend, and repeal bylaws for the regulation of its

affairs and the conduct of its business.

impleaded.

(d) Borrow money and issue bonds and notes according to the

provisions of this act.

(e) Make and enter into contracts, agreements, or instruments

necessary, incidental, or convenient to the performance of its

duties and execution of its powers, duties, and jurisdictions under

this act with any federal, state, local, or intergovernmental

governmental agency or with any other person or entity, public or

private, upon terms and conditions acceptable to the authority.

(f) Engage in collective negotiation or collective bargaining

and enter into agreements with a bargaining representative as

provided by 1947 PA 336, MCL 423.201 to 423.217.

(g) Solicit, receive, and accept gifts, grants, labor, loans,

contributions of money, property, or other things of value, and

other aid or payment from any federal, state, local, or

intergovernmental government agency or from any other person or

entity, public or private, upon terms and conditions acceptable to

the authority, or participate in any other way in a federal, state,

local, or intergovernmental government program.

(h) Make application for and receive loans, grants,

guarantees, or other financial assistance in aid of a convention

facility from any state, federal, local, or intergovernmental

government or agency or from any other source, public or private,

including, but not limited to, financial assistance for purposes of

developing, planning, constructing, improving, and operating a

convention facility.

(i) Procure insurance or become a self-funded insurer against

loss in connection with the property, assets, or activities of the

authority.

(j) Indemnify and procure insurance indemnifying board members

from personal loss or accountability for liability asserted by a

person with regard to bonds or other obligations of the authority,

or from any personal liability or accountability by reason of the

issuance of the bonds or other obligations or by reason of any

other action taken or the failure to act by the authority.

(k) Invest money of the authority, at the discretion of the

board, in instruments, obligations, securities, or property

determined proper by the board and name and use depositories for

authority money. Investments shall be made consistent with an

investment policy adopted by the board that complies with section

13 of the public employee retirement system investment act, 1965 PA

314, MCL 38.1133. The authority may invest the fund's assets in the

investment instruments and subject to the investment limitations

governing the investment of assets of public employee retirement

systems under the public employee retirement system investment act,

1965 PA 314, MCL 38.1132 to 38.1140m.

(l) Contract for goods and services as necessary and as

provided under this act. An authority may contract with a

management firm, either corporate or otherwise, to operate a

qualified convention facility, under the supervision of the

authority with the affirmative vote of at least 5 board members.

(m) Employ legal and technical experts, other officers,

agents, employees, or other personnel, permanent or temporary, as

considered necessary by the board as provided under this act.

(n) Contract for the services of persons or entities for

rendering professional or technical assistance, including, but not

limited to, consultants, managers, legal counsel, engineers,

accountants, and auditors, as provided under this act.

(o) Establish and maintain an office.

(p) Acquire by gift, devise, transfer, exchange, purchase,

lease, or otherwise on terms and conditions and in a manner the

authority considers proper property or rights or interests in

property. Property or rights or interests in property acquired by

an authority may be by purchase contract, lease purchase,

agreement, installment sales contract, land contract, or otherwise.

The acquisition of any property by an authority for a convention

facility in furtherance of the purposes of the authority is for a

public use, and the exercise of any other powers granted to the

authority is declared to be public, governmental, and municipal

functions, purposes, and uses exercised for a public purpose and

matters of public necessity.

(q) Hold, clear, remediate, improve, maintain, manage,

protect, control, sell, exchange, lease, or grant easements and

licenses on property or rights or interests in property that the

authority acquires, holds, or controls.

(r) Except as provided in section 19(13), convey, sell,

transfer, exchange, lease, or otherwise dispose of property or

rights or interest in property to any person or entity on terms and

condition, and in a manner and for consideration the authority

considers proper, fair, and valuable.

(s) Develop a convention facility.

(t) Assume and perform the obligations and covenants of a

local government related to a qualified convention facility.

(u) Enter into exclusive or nonexclusive contracts, leases,

franchises, or other arrangements with persons or entities for

terms not exceeding 50 years, for 1 or more of the following

purposes:

(i) Granting the privilege of using or improving or having

access to all or any portion of a convention facility for

commercial purposes.

(ii) Granting the privilege of naming or placing advertising on

or in all or any portion of a convention facility.

(iii) Granting the privilege of supplying goods, commodities,

things, services, or facilities at a convention facility or any

portion of a convention facility.

(iv) Making available services to be furnished at a convention

facility, or any portion of a convention facility, under the

operational jurisdiction of the authority.

(v) Receiving financial or other assistance from a person

licensed under section 6 of the Michigan gaming control and revenue

act, 1996 IL 1, MCL 432.206.

(v) Establish and fix a schedule of rents, admission fees, or

other charges for occupancy, use of, or admission to any convention

facility operated by the authority and provide for the collection

and enforcement of those rents, admission fees, or other charges.

(w) Adopt reasonable rules and regulations for the orderly,

safe, efficient, and sanitary operation and use of a convention

facility owned by the authority or under its operational

jurisdiction.

(x) Contract with law enforcement agencies for the purpose of

providing security and law enforcement functions at a convention

facility.

(y) Do all other acts and things necessary or convenient to

exercise the powers, duties, and jurisdictions of the authority

under this act or other laws that related to the purposes, powers,

duties, and jurisdictions of the authority.

(2) Notwithstanding any other provision of law to the

contrary, an authority shall not have the power to impose or levy a

tax.

Sec. 19. (1) Within 89 days of the effective date of this act

or the date on which a metropolitan area becomes a qualified

metropolitan area and prior to a transfer date, the legislative

body of a qualified city in the qualified metropolitan area may by

resolution approve the transfer of a qualified convention facility

to an authority. All of the following shall occur on a transfer

date:

(a) All right, title, and interest of a local government in

and to a qualified convention facility located in a qualified

metropolitan area shall by operation of this act be conveyed and

transferred from the local government to the authority for the

qualified metropolitan area, and the authority shall receive,

succeed to, and assume the exclusive right, responsibility, and

authority to own, occupy, operate, control, develop, and use the

qualified convention facility from and after the transfer date,

including, but not limited to, all real property, buildings,

improvements, structures, easements, rights of access, and all

other privileges and appurtenances pertaining to the qualified

convention facility, subject only to those restrictions imposed by

this act.

(b) All right, title, and interest in and to the fixtures,

equipment, materials, furnishings, and other personal property of a

local government owned or controlled and used for purposes of the

qualified convention facility by the local government shall by

operation of this act be conveyed and transferred from the local

government to the authority for the qualified metropolitan area,

and the authority shall receive, succeed to, and assume the

exclusive right, responsibility, and authority to possess and

control the property from and after the transfer date.

government related to the ownership, occupancy, operation, control,

development, or use of a qualified convention facility by the local

government shall by operation of this act be conveyed and

transferred from the local government to the authority for the

qualified metropolitan area and be assumed by the authority.

(d) All grant agreements, grant preapplications, grant

applications, rights to receive the balance of any funds payable

under the agreements or applications, the right to receive any

amounts payable from and after the transfer date, and the benefits

of contracts or agreements of a local government related to the

ownership, occupancy, operation, control, development, or use of a

qualified convention facility by the local government shall by

operation of this act be conveyed and transferred from the local

government to the authority for the qualified metropolitan area and

be assumed by the authority.

(e) All of the duties, liabilities, responsibilities, and

obligations of a local government related to the ownership,

occupancy, operation, control, development, or use of a qualified

convention facility by the local government shall by operation of

this act be conveyed and transferred from the local government to

the authority for the qualified metropolitan area and assumed by

the authority, except for any liabilities, responsibilities, or

obligations that are contested in good faith by, or, as of the

transfer date, unknown to, the authority.

(f) An authority for a qualified metropolitan area shall

assume all of the outstanding securities of the local government

that were originally issued to finance the acquisition or

construction of, development of, or improvements to the qualified

convention facility conveyed and transferred to the authority for

the qualified metropolitan area under this section, and the

authority shall refund or defease the securities. If the authority

refunds the outstanding securities assumed under this subsection,

that refunding shall be considered, as a matter of law, to be

necessary to eliminate requirements of covenants applicable to the

existing outstanding securities.

(2) An authority may, in its sole discretion, assume, accept,

or become liable for any or all of the lawful agreements,

obligations, promises, covenants, commitments, and other

requirements of a local government relating to a qualified

convention facility conveyed and transferred under this section,

except as provided in subsection (4). An authority shall perform

all of the duties and obligations and shall be entitled to all of

the rights of a local government and under any agreements expressly

assumed and accepted by the authority related to the transfer of a

qualified convention facility from the local government to the

authority under this section.

(3) The local chief executive officer of a local government

from which the rights, responsibility, and authority to own occupy,

operate, control, develop, and use a qualified convention facility

are conveyed and transferred from the local government to an

authority for a qualified metropolitan area under this section

shall execute the instruments of conveyance, assignment, and

transfer or other documents as may, in the authority's judgment, as

necessary or appropriate to recognize, facilitate, or accomplish

the transfer of the qualified convention facility from the local

government to the authority under this section.

(4) An authority for a qualified metropolitan area shall not

assume any unfunded obligations of a local government transferring

a qualified convention facility under this section to provide

pensions or retiree health insurance. Upon request by the

authority, the local government shall provide the authority with a

statement of the amount of the unfunded obligations, determined by

a professional actuary acceptable to the authority.

(5) All lawful actions, commitments, and proceedings of a

local government made, given, or undertaken before the transfer

date and assumed by an authority under this section are ratified,

confirmed, and validated upon assumption. All actions, commitments,

or proceedings of the local government relating to a qualified

convention facility in the process of being undertaken by, but not

yet a commitment or obligation of, the local government regarding

the qualified convention facility may, from and after the date of

assumption by the authority under this section, be undertaken and

completed by the authority in the manner and at the times provided

in this act or other applicable law and in any lawful agreements

made by the local government before the date of assumption by the

authority under this section.

(6) The exclusive right and authorization to own, occupy,

operate, control, develop, and use a qualified convention facility

transferred under this section shall include, but not be limited

to:

(a) Ownership and operational jurisdiction over all real

property of the qualified convention facility, subject to any liens

of record and legal restrictions and limitations on the use of the

property.

(b) The local government's right, title, and interest in, and,

to the extent accepted by the authority, all of the local

government's responsibilities arising under leases and concessions

relating to, a qualified convention facility.

(7) The transfers described under this section shall include,

but need not be limited to, all of the following:

(a) All contracts with licensees, franchisees, tenants,

concessionaires, and leaseholders.

(b) All operating financial obligations secured by revenues

and fees generated from the operations of the qualified convention

facility.

from operations of the qualified convention facility, all funds

held under an ordinance, resolution, or indenture related to or

securing obligations of the local government assumed by the

authority, and all of the accounts receivable or choses in action

arising from operations of the qualified convention facility.

(d) All office equipment, including, but not limited to,

computers, records and files, software, and software licenses

required for financial management, personnel management, accounting

and inventory systems, and general administration.

(8) The transfer of the real and personal property and

operational jurisdiction over a qualified convention facility to an

authority may not in any way impair any contracts with licensees,

franchisees, vendors, tenants, bondholders, or other parties in

privity with the local government that owned a qualified convention

facility transferred to an authority under this section, if the

contracts were not entered into or modified in violation of this

act.

(9) From and after the transfer date, a local government from

which a qualified convention facility has been transferred shall be

relieved from all further costs, responsibility, and liability

arising from, or associated with, control, operation, development,

and maintenance of the qualified convention facility. The local

government shall continue to be responsible for all costs

associated with local municipal services, including, but not

limited to, police, fire, and emergency medical services, without

any additional compensation from the authority. The authority shall

provide for the payment of compensation not exceeding

$20,000,000.00 to the qualified city for any revenue otherwise

payable to the qualified city from parking facilities operated by

the qualified city at the qualified convention facility and for

other costs incurred by the qualified city associated with the

transfer of the qualified convention facility to the authority

under this section.

(10) A local government that owns a qualified convention

facility subject to transfer under this section or that owned a

qualified convention facility transferred to an authority under

this section shall comply with all of the following, before and

after the transfer:

(a) Refrain from any action to sell, transfer, or otherwise

dispose of a qualified convention facility other than to the

authority or incur new or expanded obligations related to qualified

convention facility, without the consent of the authority.

(b) Refrain from any approval of or material modification to

any collective bargaining agreement applicable to local government

employees employed at or assigned to the qualified convention

facility or to terms of employment for employees at or assigned to

the qualified convention facility. Any approval or modification

subject to this subsection shall be null and void.

would impair the authority's exercise of the powers granted to the

authority under this act or that would impair the efficient

operation and management of the qualified convention facility by

the authority.

(d) Take all actions reasonably necessary to cure any defects

in title to the qualified convention facility and related property

transferred under this section, including, but not limited to,

providing documents, records, and proceedings in respect of title.

(e) At the request of an authority, grant any license,

easement, or right-of-way in connection with the qualified

convention facility to the extent the authority has not been

empowered to take these actions.

(f) Upon creation, an authority for the qualified metropolitan

area in which the local government is located and before the

transfer date may conduct operations, maintenance, and repair of

the convention facility in the ordinary and usual course of

business.

(11) Any contract, agreement, lease, sale, disposition,

transfer, or other conveyance, easement, license, right,

obligation, debt, or liability assumed, approved, entered into,

amended, or modified in violation of this section shall be voidable

as a matter of law to the extent that the authority would otherwise

assume, become party to or transferee of, or otherwise be obligated

under the contract, agreement, lease, sale, disposition, transfer,

conveyance, easement, license, right, obligation, debt, or

liability.

(12) Unless otherwise provided in this act, the local chief

executive officer of a local government that owns a qualified

convention facility subject to transfer under this section is

authorized and shall take all reasonable steps to cancel or

terminate any agreement to which the local government is a party

that relates to the qualified convention facility and meets all the

following criteria:

(a) The authority has not expressly assumed or accepted the

agreement under subsection (2).

(b) The agreement provides for cancellation or termination.

authority would become a party to the agreement by succession,

assignment, operation of law, or any other involuntary means.

(13) If real property transferred from a qualified city to an

authority under this section is no longer used by the authority for

the purpose of maintaining or operating a convention facility, all

right, title, and interest of the authority in the real property

shall revert from the authority to the qualified city.

Sec. 21. (1) The authority, as of the transfer date,

immediately shall assume and be bound by any existing collective

bargaining agreements applicable to employees of the local

government whose employment is transferred to the authority either

as a result of the authority's express assumption of the employees

or by application of section 19 for the remainder of the term of

the collective bargaining agreement. Local government employees

whose employment is not transferred to the authority shall be

reassigned within the local government, pursuant to the terms of

any applicable collective bargaining agreements. A representative

of the employees or a group of employees in the local government

who represents or is entitled to represent the employees or a group

of employees of the local government pursuant to 1947 PA 336, MCL

423.201 to 423.217, shall continue to represent the employee or

group of employees after the employees transfer to the authority.

This subsection does not limit the rights of employees, pursuant to

applicable law, to assert that a bargaining representative

protected by this subsection is no longer their representative. The

rights and benefits protected by this subsection may be altered by

a future collective bargaining agreement or, for employees not

covered by collective bargaining agreements, by benefit plans as

established and adopted by the authority.

(2) Transferred employees shall not by reason of the transfer

have their accrued local government pension benefits or credits

diminished. If a transferring employee is not vested in his or her

local government pension rights at the time of transfer, his or her

posttransfer service with the authority shall be credited toward

vesting in any local government retirement system in which the

transferring employee participated prior to the transfer, but

posttransfer service with the authority shall not be credited for

any other purpose under the local government's retirement system,

except as provided in subsection (4).

(3) A transferred local government employee described in this

section or a person hired by the authority as a new employee after

the transfer date shall remain or become a participant in the local

government retirement system until the authority has established

its own retirement system or pension plan. During the period the

employee remains or is a participant in the local government

system, the employee's posttransfer service with the authority and

his or her posttransfer compensation from the authority shall be

counted in determining both eligibility for and the amount of

pension benefits that the employee will be eligible to receive from

the local government system or plan.

(4) If the local government maintains a retirement system that

provides for continuing participation and benefit accrual by local

government employees who transfer their employment to another

entity in conjunction with transfer of a local government function

to that entity, then the transferred employee may elect to remain a

participant in the local government retirement system in lieu of

participation in any retirement system or pension plan of the

authority. If the transferred employee elects to remain a

participant in the local government system, the employee's

posttransfer service with the authority and his or her posttransfer

compensation from the authority shall be counted in determining

both eligibility for and the amount of pension benefits that the

employee will be eligible to receive from the local government

system or plan. Any election to remain in a local government system

or plan shall be made within 60 days following the date the

authority has established its own retirement system or pension plan

and shall be irrevocable. Employees eligible to make the election

described in this subsection shall be those employees who

immediately before their transfer date were participating in the

local government system and who agree to make any employee

contributions required for continuing participation in the local

government system and also agree to meet all requirements and be

subject to all conditions that, from time to time, apply to

employees of the local government who participate in the local

government system.

(5) For each employee meeting the requirements of subsection

(4) who elects to remain a participant in the local government

retirement system, the authority shall, on a timely basis,

contribute, as applicable, to the trustees of that retirement

system an amount determined by the local government system's

actuary to be sufficient to fund the liability for all of that

employee's retirement and other postemployment benefits under the

system on a current basis, as those liabilities are accrued from

and after the transfer date.

Sec. 23. (1) Except as provided in subsection (3), an

authority may raise revenues to fund all of its activities,

operations, and investments consistent with its purposes. The

sources of revenue available to the authority may include, but are

not limited to, any of the following:

(a) Rents, admission fees, or other charges for use of a

convention facility which the authority may fix, regulate, and

collect.

(b) Federal, state, or local government grants, loans,

appropriations, payments, or contributions.

other disposition of property that the authority has acquired.

(d) Grants, loans, appropriations, payments, proceeds from

repayments of loans made by the authority, or contributions from

public or private sources.

(e) Distributions from the convention facility development

fund of the state pursuant to the state convention facility

development act, 1985 PA 106, MCL 207.621 to 207.640.

(f) Investment earnings on the revenues described in

subdivisions (a) to (e).

(2) The revenues raised by an authority may be pledged, in

whole or in part, for the repayment of bonded indebtedness and

other expenditures issued or incurred by the authority.

(3) Notwithstanding any other provision of law to the

contrary, an authority shall not have the power to impose or levy a

tax.

(4) The board by resolution may establish a regional

convention facility operating trust fund for the purpose of

accumulating funds to pay for the cost of operating and maintaining

a qualified convention facility. Money for operating and

maintaining a qualified convention facility, at the authority's

discretion, may be provided from this fund or any other money of

the authority. The resolution establishing the fund shall include

all of the following:

(a) The designation of a person or persons who shall act as

the fund's investment fiduciary.

(b) A restriction of withdrawals from the fund solely for the

payment of reasonable operating and maintenance expenses of a

convention facility and the payment of the expenses of

administration of the fund.

(5) An investment fiduciary shall invest the assets of the

fund in accordance with an investment policy adopted by the board

that complies with section 13 of the public employee retirement

system investment act, 1965 PA 314, MCL 38.1133. However, the

investment fiduciary shall discharge his or her duties solely in

the interest of the authority. The authority may invest the fund's

assets in the investment instruments and subject to the investment

limitations governing the investment of assets of public employee

retirement systems under the public employee retirement system

investment act, 1965 PA 314, MCL 38.1132 to 38.1140m.

Sec. 25. (1) For the purpose of acquiring, purchasing,

constructing, improving, enlarging, furnishing, equipping,

reequipping, developing, or repairing a convention facility

transferred under section 19 or subsequently acquired by an

authority, the authority may issue self-liquidating bonds of the

authority in accordance with and exercise all of the powers

conferred upon public corporations by the revenue bond act of 1933,

1933 PA 94, MCL 141.101 to 141.140. Revenue bonds issued by the

authority are a debt of the authority and not a debt of any

qualified county, county, qualified city, city, or this state.

(2) The authority may borrow money and issue municipal

securities in accordance with and exercise all of the powers

conferred upon municipalities by the revised municipal finance act,

2001 PA 34, MCL 141.2101 to 141.2821.

(3) The authority may issue a municipal security that bears no

interest and appreciates as to principal amount if the municipal

security is rated investment grade by a nationally recognized

rating agency or has insurance for payment of the principal and

interest on the municipal security to the holders of the municipal

security. The municipal securities authorized by this subsection

shall be exempt from the limitations of section 305 of the revised

municipal finance act, 2001 PA 34, MCL 141.2305, except that the

accreted principal amount of the municipal security shall be

considered interest and shall be within the interest rate

limitations provided in section 305(1) of the revised municipal

finance act, 2001 PA 34, MCL 141.2305.

(4) All bonds or other evidences of indebtedness issued by an

authority under this act, and the interest on the bonds or other

evidences of indebtedness, are free and exempt from all taxation

within this state, except for transfer and franchise taxes.

(5) The issuance of bonds by an authority shall require the

affirmative vote of at least 5 board members.

(6) For the purpose of more effectively managing its debt

service, an authority may enter into an interest rate exchange or

swap, hedge, or similar agreement or agreements in connection with

the issuance or proposed issuance of obligations or other evidences

of indebtedness or in connection with its then outstanding

obligations or other evidences of indebtedness.

(7) In connection with entering into an interest rate exchange

or swap, hedge, or similar agreement, the authority may create a

reserve fund for the payment thereof.

(8) An agreement entered into pursuant to this section shall

comply with all of the following:

(a) The agreement is not a debt of the authority entering into

the agreement for any statutory or charter debt limitation purpose.

(b) The agreement is payable from general funds of the

authority or, subject to any existing contracts, from any available

money or revenue sources, including revenues specified by the

agreement, securing the obligation or evidence of indebtedness in

connection with which the agreement is entered into.

Sec. 27. (1) Notwithstanding any other provisions of this act

or any other law, the provisions of all ordinances, resolutions,

and other proceedings of the local government in respect to any

outstanding bonds, notes, or any and all evidences of indebtedness

or liability assumed by an authority pursuant to this act, if any,

shall constitute a contract between the authority and the holders

of the bonds, notes, or evidences of indebtedness or liability and

are enforceable against the authority or any or all of its

successors or assigns, by mandamus or any other appropriate suit,

action, or proceeding in law or in equity in any court of competent

jurisdiction in accordance with law.

(2) Bonds, notes, or any and all evidences of indebtedness or

liability that are assumed by an authority under this act shall be

payable from and secured by the sources of revenue that were

pledged to those bonds, notes, or evidences of indebtedness or

liability under the ordinance, resolution, or other proceedings of

the local government and shall not constitute a full faith and

credit obligation of the authority or of this state.

(3) Nothing in this act or in any other law shall be held to

relieve the local government from which a convention facility has

been transferred from any bonded or other debt or liability

lawfully contracted by the local government, to which the full

faith and credit of the local government has been pledged and that

remains outstanding as of the transfer date, notwithstanding that

the proceeds of the debt or liability have been used by the local

government in support of the convention facility.

(4) Upon the transfer of a convention facility to an

authority, trustees, paying agents, and registrars for any

obligation of the local government that has been expressly assumed

by the authority under section 19 shall perform all of their duties

and obligations and provide all notices related to the obligations

as if the authority were the issuer of the obligations. The

trustees, paying agents, and registrars shall care for and consider

all revenues and funds pledged to secure obligations of the local

government that have been assumed by the authority under section 19

as revenues and funds of the authority. The authority shall

indemnify and hold harmless these trustees, paying agents, and

registrars from liability incurred in compliance with this

subsection.

Sec. 29. (1) Unless permitted by this act or approved by an

authority, any restrictions standards or prerequisites of a local

government otherwise applicable to an authority and enacted after

the effective date of this act shall not apply to an authority.

This subsection is intended to prohibit special local legislation

or ordinances applicable exclusively or primarily to an authority

and not to exempt an authority from laws generally applicable to

other persons or entities.

(2) The powers conferred in this act upon any authority or

local government shall be in addition to any other powers the

authority or local government possesses by charter or statute. The

provisions of this act apply notwithstanding any resolution,

ordinance, or charter provision to the contrary.

(3) This act shall be construed liberally to effectuate the

legislative intent and the purpose of this act as complete and

independent authorization for the performance of each and every act

and thing authorized in the act, and all powers granted in this act

shall be broadly interpreted to effectuate the intent and purposes

of this act and not as to limitation of powers.

Enacting section 1. This act does not take effect unless all

of the following bills of the 94th Legislature are enacted into

law:

(a) House Bill No. 5691.

(b) House Bill No. 6405.