SB-0719, As Passed Senate, February 12, 2014

SUBSTITUTE FOR

SENATE BILL NO. 719

     A bill to amend 1994 PA 451, entitled

"Natural resources and environmental protection act,"

by amending section 19612 (MCL 324.19612), as amended by 2012 PA

446.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 19612. (1) A recipient of a grant or a loan made with

money from the fund shall do both of the following:

     (a) Keep an accounting of the money spent on the project or

facility in a generally accepted manner. The accounting shall be

subject to a postaudit.

     (b) Obtain authorization from the administering state

department before implementing a change that significantly alters

the proposed project.

     (2) The administering state department may revoke a grant or a

loan made with money from the fund or withhold payment if the

recipient fails to comply with the terms and conditions of the

grant or loan agreement or with the requirements of this part or

the rules promulgated under this part, or with other applicable law

or rules. If a grant or loan is revoked, the administering state

department may recover all funds awarded.

     (3) The administering state department may withhold a grant or

a loan until the administering state department determines that the

recipient is able to proceed with the proposed project.

     (4) To assure timely completion of a project, the

administering state department may withhold 10% of the grant or

loan amount until the project is complete.

     (5) If an approved applicant fails to sign a grant or loan

agreement within 90 days after receipt of a written grant or loan

offer by the administering state department, the administering

state department may cancel the grant or loan offer. The applicant

may not appeal or contest a cancellation pursuant to this

subsection.

     (6) The administering state department may terminate a grant

or loan agreement and require immediate repayment of the grant or

loan if the recipient uses grant or loan funds for any purpose

other than for the approved activities specified in the grant or

loan agreement. The administering state department shall provide

the recipient written notice of the termination 30 days prior to

the termination.

     (7) A loan made with money in the fund shall have the

following terms:

     (a) A loan interest rate of not more than 50% of the prime

rate as determined by the administering state department as of the

date of approval of the loan.

     (b) Loan recipients shall repay loans in equal annual

installments of principal and interest beginning not later than 5

years after execution of a loan agreement and concluding not later

than 15 years after execution of a loan agreement.

     (c) A loan recipient shall enter into a loan agreement with

the administering state department.

     (d) Upon default of a loan, as determined by the administering

state department, or upon the request of the loan recipient as a

method to repay the loan, the department of treasury shall withhold

state payments from the loan recipient in amounts consistent with

the repayment schedule in the loan agreement until the loan is

repaid. The department of treasury shall deposit these withheld

funds into the fund until the loan is repaid.

     (8) Upon request of a loan recipient and a showing of

financial hardship related to the project that was financed in

whole or in part by the loan, the administering state department

may renegotiate the terms of any outstanding loan, including the

length of the loan, the interest rate, and the repayment terms. The

department shall report to the legislature the number of loans

refinanced under this subsection, the local unit of government or

authority responsible for each loan refinanced, and the change in

the amount of the loan or the change in the terms of the loan, as

appropriate. This information may be included in the report

prepared by the department under section 16 of the brownfield

redevelopment financing act, 1996 PA 381, 125.2666.

(9) (8) Loan payments and interest shall be deposited in the

fund.

(10) (9) Upon default of a loan, as determined by the

administering state department, or upon the request of the loan

recipient as a method to repay the loan, the department of treasury

shall withhold from the loan recipient state payments in amounts

consistent with the repayment schedule in the loan agreement until

the loan is repaid. The department of treasury shall deposit these

withheld funds into the fund until the loan is repaid.