HB-4496, As Passed House, June 17, 2015HB-4496, As Passed Senate, June 17, 2015
April 21, 2015, Introduced by Reps. Victory, Jacobsen, Hughes, Howrylak, Hooker, Pagel, McCready, Inman and Forlini and referred to the Committee on Financial Liability Reform.
A bill to amend 2005 PA 92, entitled
"School bond qualification, approval, and loan act,"
by amending section 3 (MCL 388.1923), as amended by 2012 PA 437.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3. As used in this act:
(a) "Computed millage" means the number of mills in any year,
not less than 7 mills and not more than 13 mills, determined on the
date of issuance of the order qualifying the bonds or on a later
date if requested by the school district and approved by the state
treasurer, that, if levied by the school district, will generate
sufficient annual proceeds to pay principal and interest on all the
school district's qualified bonds plus principal and interest on
all qualified loans related to those qualified bonds no later than
the final mandatory repayment date. Based on changes of
circumstances, including, but not limited to, additional bond
qualification, refundings, changes in qualified loan interest
rates, changes in taxable values, and assumptions contained in any
then currently effective guidelines issued by the state treasurer
pursuant to section 5(2)(c), the school district shall not less
than annually, beginning on October 1, 2013, using methods
prescribed in this act, recalculate the computed millage necessary
to generate sufficient annual levy proceeds to pay principal and
interest on all of the school district's qualified bonds and
principal and interest on all qualified loans related to those
qualified bonds not later than the final mandatory repayment date.
If the school district determines that the recalculated computed
millage is lower than its current millage levy rate, the school
district shall promptly notify the state treasurer in writing of
the recalculated computed millage. Immediately thereafter, the
school district shall decrease its millage levy rate to the
recalculated computed millage, but not below the computed millage
established pursuant to the most recent order qualifying bonds,
other than an order qualifying refunding bonds, for that school
district, or to the minimum levy prescribed by law for receipt of
qualified loans, whichever rate is higher. If the school district
determines that the recalculated computed millage is higher than
its current millage levy rate, the school district shall promptly
notify the state treasurer in writing of the recalculated computed
millage. Immediately thereafter, the school district shall increase
its millage levy rate to the recalculated computed millage, subject
to 1 of the following exceptions, and subject to any maximum
millage levy rate otherwise prescribed for by law:
(i) For each school district's first recalculated computed
millage required as of October 1, 2013, increase its millage levy
by a percentage amount equal to the equivalent percentage of
taxable value change for that school district over the immediately
preceding 5 years, but not higher than the recalculated computed
millage.
(ii) For each school district's subsequent recalculated
computed millage beginning October 1, 2014 and each year
thereafter, increase its millage levy by a percentage amount equal
to the percentage of taxable value decline for the immediately
preceding year ending September 30, but not to a rate higher than
the recalculated computed millage.
(iii) If it is determined that a district's current computed
millage is sufficient to pay all qualified loans by the mandatory
final loan repayment date, no recalculation of the computed millage
is required.
(b) "Final mandatory repayment date" means the final mandatory
repayment date determined by the state treasurer under section 9.
(c) "Michigan finance authority" means the Michigan finance
authority created under Executive Reorganization Order No. 2010-2,
MCL 12.194.
(d) "Qualified bond" means a bond that is qualified under this
act for state loans as provided in section 16 of article IX of the
state constitution of 1963. A qualified bond includes the interest
amount required for payment of a school district's net interest
obligation under an interest rate exchange or swap, hedge, or other
agreement entered into pursuant to the revised municipal finance
act, 2001 PA 34, MCL 141.2101 to 141.2821, but does not include a
termination payment or similar payment related to the termination
or cancellation of an interest rate exchange or swap, hedge, or
other similar agreement. A qualified bond may include a bond issued
to refund loans owed to the state under this act.
(e) "Qualified loan" means a loan made under this act or
former 1961 PA 108 from this state to a school district to pay debt
service on a qualified bond.
(f) "Revolving loan fund" means the school loan revolving fund
created under section 16c of the shared credit rating act, 1985 PA
227, MCL 141.1066c.
(g) "School district" means a general powers school district
organized under the revised school code, 1976 PA 451, MCL 380.1 to
380.1852, or a school district of the first class as described in
the revised school code, 1976 PA 451, MCL 380.1 to 380.1852, having
the power to levy ad valorem property taxes.
(h) "State treasurer" means the state treasurer or his or her
duly authorized designee.
(i) "Taxable value" means the value determined under section
27a of the general property tax act, 1893 PA 206, MCL 211.27a.