SB-1243, As Passed House, June 27, 2008

HOUSE SUBSTITUTE FOR

SENATE BILL NO. 1243

     A bill to amend 1966 PA 346, entitled

"State housing development authority act of 1966,"

by amending section 58b (MCL 125.1458b), as added by 2004 PA 480,

and by adding sections 58e and 58f; and to repeal acts and parts of

acts.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 58b. (1) The authority shall create and implement the

Michigan housing and community development program for the purpose

of developing and coordinating public and private resources to meet

the affordable housing needs of low income, very low income, and

extremely low income households and to finance projects located in

a downtown area or adjacent neighborhood in this state.

     (2) The authority shall identify, select, and make financing

available to eligible applicants from money in the fund or from

money secured by the fund for affordable housing for low income,

very low income, and extremely low income households and for

projects located in a downtown area or adjacent neighborhood. This

subsection does not preclude the authority from using other

resources in conjunction with the fund for a purpose authorized

under this chapter.

     (3) The authority shall promulgate rules according to the

administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to

24.328, providing for the terms and conditions under which

assistance made under this chapter shall be recaptured.

(3) (4) The authority shall develop an annual a biennial

allocation plan providing for the allocation of money from the

fund, according to all of the following:

     (a) The allocation plan shall contain a formula for

distributing money throughout the state based on the number of

persons experiencing poverty, economic, and housing distress in

various regions of the state.

     (b) The allocation plan shall identify eligible applicants,

include a preference for special population groups described in

section 58c(2). , and preference for geographic targeting in

designated revitalization areas including, but not limited to,

neighborhood preservation areas, state renaissance zones, core

communities, and federally-designated enterprise community or

homeownership zones.

     (c) Not less than 25% of the fund shall be earmarked for

rental housing projects that do not qualify under preferences for

special population groups , geographic preferences, or other

preferences contained in the allocation plan.

     (d) Not less than 30% of the fund shall be earmarked for

projects that target extremely low income households and include at

a minimum both of the following activities:

     (i) Developing developing housing for the homeless, supportive

housing, transitional housing, and permanent housing.

     (ii) Providing security deposits, supportive services, and

technical assistance to eligible applicants.

     (e) A rental housing project assisted by the fund must provide

affordable housing for households earning no more than 60% of the

median income set aside at least 20% of the rental units included

in the project for households earning no more than 60% of the area

median income.

     (f) A home ownership project assisted by the fund must provide

affordable housing for households earning no more than 60% of the

median income set aside at least 20% of the housing units in the

project for households earning no more than 60% of the area median

income.

     (g) Money that has not been committed at the end of a fiscal

year shall not be carried over in the category to which the money

had been allocated during that fiscal year, but shall be

reallocated for the next fiscal year according to the next fiscal

year's allocation plan.

     (5) Each year, the authority shall hold public hearings in at

least 3 separate locations throughout this state on the priorities

and draft allocation plan for the upcoming year. After the public

hearings, the authority may make minor modifications to the

allocation plan necessary to facilitate the administration of the

Michigan housing and community development program or to address

unforeseen circumstances. Prior to developing the biennial

allocation plan, the authority shall hold public hearings in at

least 3 separate locations in this state regarding the content of

the biennial allocation plan. The authority may make modifications

to the allocation plan necessary to facilitate the administration

of the Michigan housing and community development program or to

address unforeseen circumstances.

     (6) The authority shall issue an annual report to the governor

and the legislature summarizing the expenditures of the fund for

the prior fiscal year including at a minimum a description of the

eligible applicants that received funding, the number of housing

units that were produced, and the income levels of the households

that were served, the number of homeless persons served, and the

number of downtown areas and adjacent neighborhoods that receive

financing.

     (7) In addition to the rules promulgated under subsection (3),

the authority shall promulgate rules according to The authority may

promulgate rules under the administrative procedures act of 1969,

1969 PA 306, MCL 24.201 to 24.328, to implement this chapter.

     Sec. 58e. (1) The Michigan housing and community development

fund advisory committee is created in the authority. The committee

shall have 10 members. Members of the committee shall include the

executive director of the authority, who shall serve as a nonvoting

ex officio member, and the following 9 members appointed by the

governor with the advice and consent of the senate:

     (a) An individual representing housing lenders, developers, or

builders appointed by the governor from a list of 3 or more

individuals nominated by the speaker of the house of

representatives.

     (b) An individual representing housing lenders, developers, or

builders appointed by the governor from a list of 3 or more

individuals nominated by the majority leader of the senate.

     (c) An individual representing cities, villages, or townships.

     (d) An individual representing local housing organizations.

     (e) An individual representing nonprofit organizations.

     (f) An individual representing a local economic development

corporation, a downtown development authority, a corridor

improvement authority, a business improvement district, or a

principal shopping district.

     (g) An individual representing a local neighborhood

association or neighborhood improvement authority.

     (h) Two other residents of this state.

     (2) Except as provided in subsection (3), the term of a member

of the committee appointed by the governor under subsection (1)

shall be 4 years.

     (3) Of the members initially appointed by the governor under

subsection (1), 2 members shall be appointed for a term expiring on

November 30, 2008, 2 members shall be appointed for a term expiring

on November 30, 2009, 3 members shall be appointed for a term

expiring on November 30, 2010, and 2 members shall be appointed for

a term expiring on November 30, 2011.

     (4) A vacancy on the committee arising for a reason other than

the expiration of a term shall be filled in the same manner as the

original appointment for the remainder of the unexpired term.

     (5) Members of the committee shall serve without compensation

but, subject to available funding, may receive reimbursement for

their actual and necessary expenses while attending meetings or

performing other authorized official business of the committee.

     (6) The governor shall designate 1 member of the committee to

serve as chairperson of the committee at the pleasure of the

governor. The members of the committee may elect a member of the

committee to serve as vice-chairperson of the committee and may

elect other members of the committee as officers of the committee

as the committee considers appropriate.

     (7) The committee may advise the authority on all of the

following:

     (a) Recommendations for the biennial allocation plan required

under section 58b.

     (b) Expenditures from the fund under this chapter, including

all of the following:

     (i) Whether expenditures are distributed fairly and equitably.

     (ii) Whether expenditures satisfy housing needs and priorities

in this state.

     (iii) Whether expenditures satisfy the economic needs and

priorities of communities benefiting from the expenditures.

     (8) The committee may meet with representatives of the

authority, including authority employees and members of the board

of directors of the authority, to discuss and provide advice on

matters relating to the fund.

     (9) The authority may provide the committee with meeting

space, supplies, and staff to support the functions of the

committee under this section.

     (10) A meeting of the committee shall be conducted as a public

meeting held in compliance with the open meetings act, 1976 PA 267,

MCL 15.261 to 15.275. Notice of the date, time, and place of a

public meeting of the committee shall be given as prescribed in the

open meetings act, 1976 PA 267, MCL 15.261 to 15.275. A majority of

the members of the committee serving constitute a quorum for the

transaction of the committee’s business. The committee shall act by

a majority vote of its serving members.

     (11) A member of the committee shall not use for personal gain

information obtained by the member while performing business of the

committee, nor shall a member of the committee disclose

confidential information obtained by the member while conducting

committee business, except as necessary to perform committee

business. The committee shall adopt a code of ethics for its

members and establish policies and procedures requiring the

disclosure of relationships that may give rise to a conflict of

interest. The committee shall require that any member of the

committee with a direct or indirect interest in any matter before

the committee disclose the member’s interest to the committee

before the committee takes any action on the matter.

     Sec. 58f. (1) When performing duties under this chapter, the

authority and the committee created under section 58e shall remain

cognizant of the rights of the holders of authority bonds or notes

and the extent to which certain authority bond and note contracts

may require the authority to either maintain sufficient personnel

or contract for services to plan authority programs and to

supervise enforcement and, where necessary, foreclosure of

authority mortgage agreements.

     (2) Nothing in this chapter shall be construed to affect the

status of money of the authority controlled by the authority as

state funds appropriated to the authority lose their identity as

state funds upon payment to the authority and become public funds

of the authority solely under the control of the authority and

funds established by or within the authority and are public trust

funds administered by the authority. Nothing in this chapter shall

be construed to impair the obligation of any bond or note issued by

the authority. Bonds and notes issued by the authority are

obligations of the authority and not obligations of this state.

     Enacting section 1. The Michigan housing and community

development fund act, 2004 PA 479, MCL 125.2821 to 125.2829, is

repealed.