COMMUNITY COLLEGE: ENERGY CONSERVATION H.B. 5806 (H-1):
SUMMARY OF HOUSE-PASSED BILL
IN COMMITTEE
House Bill 5806 (Substitute H-1 as passed by the House)
Sponsor: Representative Al Pscholka
House Committee: Energy and Technology
Senate Committee: Energy and Technology
CONTENT
The bill would amend the Community College Act to do the following:
-- Extend the maximum term of an installment contract or notes issued to finance energy conservation improvements from 10 years to 25 years.
-- Delete a provision that allows a community college's contractual agreement for energy conservation improvements to provide that the cost of the improvements is paid only if the energy savings are sufficient to cover it.
The Act authorizes a community college board of trustees to provide for energy conservation improvements to be made to community college facilities, and to pay for the improvements from operating funds of the community college district or from the savings that result from the improvements. The board may acquire improvements by installment contract or may borrow money and issue notes for the purpose of securing funds for them. Additionally, the board may enter into contracts in which the cost is paid from a portion of the savings resulting from the improvements.
The Act specifies that the contractual agreements may provide that the cost of the improvements is paid only if the energy savings are sufficient to cover their cost. The bill would delete this provision.
Currently, the installment contracts or notes may extend for a maximum of 10 years. Under the bill, the term of an installment contract or notes could not exceed 25 years from the date of installation of the energy conservation improvements.
MCL 389.122 Legislative Analyst: Julie Cassidy
FISCAL IMPACT
The bill would have no fiscal impact on State government and an indeterminate impact on community college districts. The bill would facilitate expenditures on energy-saving improvements for college buildings. The fiscal impact would depend on the potential improvements financed due to the proposed increase in the duration of installment contracts, or notes, from 10 to 25 years. Eliminating the provision that contract agreements may provide that the cost of the energy conservation improvements are paid only if the energy savings are sufficient to cover the costs should not have a substantive impact because the provision is permissive.
This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent.