HOUSE BILL NO. 4694

June 26, 2025, Introduced by Rep. Markkanen and referred to Committee on Natural Resources and Tourism.

"Recreational authorities act,"

by amending sections 5, 7, 9, 11, and 21 (MCL 123.1135, 123.1137, 123.1139, 123.1141, and 123.1151), sections 5 and 21 as amended by 2003 PA 135 and section 11 as amended by 2016 PA 173, and by adding section 10.

the people of the state of michigan enact:

Sec. 5. (1) Two One or more municipalities or districts may establish a recreational authority. A recreational authority is an authority under section 6 of article IX of the state constitution of 1963. A recreational authority under this act constitutes a governmental subdivision or unit of this state and a public body corporate and politic. A recreational authority under this act is a local unit of government or public authority under section 1901 of the natural resources and environmental protection act, 1994 PA 451, MCL 324.1901.

(2) To initiate the establishment of an authority, articles of incorporation shall must be prepared. The articles of incorporation shall must include all of the following:

(a) The name of the authority.

(b) The names of the participating municipality or municipalities.

(d) The size of the board of the authority, which shall must be comprised of an odd number of members; the qualifications, method of selection, and terms of office of board members; and the filling of vacancies in the office of board member. If board members are elected in at-large elections by the qualified and registered electors of the participating municipality or municipalities, voting collectively, the election of board members shall must be conducted pursuant to under the same procedures that govern an election for a tax under sections 13 to 17.

(e) The purposes for which the authority is established. , which shall be Permissible purposes include the acquisition, construction, operation, maintenance, or improvement of 1 or more of the following:

(i) A public swimming pool.

(ii) A public recreation center.

(iii) A public auditorium.

(iv) A public conference center.

(v) A public park.

(vi) A public museum.

(vii) A public historic farm.

(viii) A public forest and natural resources area.

(f) The procedure and requirements for a municipality or district to become a participating municipality in, and for a participating municipality to withdraw from, an existing authority or to join in the original formation of an authority. For a municipality or district to become a participating municipality in an existing authority or to join in the original formation of an authority, a majority of the electors of the municipality or district proposed to be included in the territory of the authority and voting on the question shall approve a tax that the authority has been authorized to levy by a vote of the electors of the authority under section 11. A municipality or district shall not withdraw from an authority during the period for which the authority has been authorized to levy a tax by the electors of the authority.

(g) Any other matters considered advisable.

(h) If the authority's purpose includes the acquisition, construction, operation, maintenance, or improvement of a public forest and natural resources area, the process by which the authority designates property the authority owns as a public forest and natural resources area.

(3) The articles shall must be adopted and may be amended by an affirmative vote of a majority of the members serving on the legislative body of each participating municipality. If a participating municipality is a district, the articles shall must be adopted and may be amended by an affirmative vote of a majority of the members serving on the legislative body of the entire municipality. The amendment of the articles is subject to the voting requirements specified by the articles. If the articles do not specify a voting requirement to amend the articles, the voting requirement to amend the articles is the same as the voting requirement to adopt the articles. Unless the articles provide otherwise, the requirements of this subsection do not apply to an amendment to the articles to allow a municipality or district to become a participating municipality in, or to allow a participating municipality to withdraw from, an existing authority.

(4) Before the articles or amendments to the articles are adopted, the articles or amendments to the articles shall must be published not less than once in a newspaper generally circulated within the participating municipality or municipalities. The adoption of articles or amendments to the articles by a municipality or district shall must be evidenced by an endorsement on the articles or amendments by the clerk of the municipality.

(5) Upon After adoption of the articles or amendments to the articles by each of the participating municipalities, municipality, a printed copy of the articles or the amended articles shall must be filed with the secretary of state by the clerk of the last participating municipality to adopt the articles or amendments.

(6) The authority's articles of incorporation, or amendments to the articles, take effect upon on filing with the secretary of state.

(7) Subject to this section, the articles of incorporation may include, but are not limited to, any of the following:

(a) Restrictions on the authority's activities, including, but not limited to, the sale of the authority's assets or property.

(b) If the authority's purpose includes the acquisition, construction, operation, maintenance, or improvement of a public forest and natural resources area, a provision to allow or require the authority to make payments in lieu of taxes to 1 or more other governmental subdivisions or units of this state in which the public forest and natural resources area is located, including a participating municipality. The payment in lieu of taxes may be calculated using a formula agreed to by the authority and the other governmental subdivisions or units of this state.

(c) If the authority has more than 1 participating municipality, the allocation of the authority's property, assets, and funds among the municipalities on the dissolution of the authority.

(d) If the authority's purpose includes the acquisition, construction, operation, maintenance, or improvement of a public forest and natural resources area, 1 or more of the following:

(i) One or more restrictions or limitations on the use of a public forest and natural resources area or portions of a public forest and natural resources area. The use restrictions or limitations may prohibit 1 or more of the uses permitted in a public forest and natural resources area under section 3(j).

(ii) A process by which 1 or more restrictions or limitations on the use of a public forest and natural resources area or portions of a public forest and natural resources area are established by the authority, and the amendment or removal of the restrictions or limitations.

(e) If the board of the authority is elected, whether the election of the board is partisan or nonpartisan.

Sec. 7. (1) A vacancy occurs on the board on the happening of if any of the events set forth in section 3 of 1846 RS 15, MCL 201.3, occurs. Appointed members of the board, if any, may be removed by the appointing authority for good cause after a public hearing. Vacancies shall must be filled in the same manner as the original appointment, or as otherwise provided in the articles, for the unexpired term.

(2) A majority of the members of the board constitutes a quorum for the purpose of conducting business and exercising the powers of an authority. Official action may be taken by an authority upon on the vote of a majority of the board members present, unless the authority adopts bylaws requiring a larger number.

(3) A member of the board shall not may receive compensation for services as a member of the board but if approved in the articles and is entitled to reimbursement for reasonable expenses, including expenses for travel previously authorized by the board, incurred in the discharge of his or her the board member's duties.

(4) The business that an authority may perform shall performs must be conducted at a public meeting of the authority 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 must be given in the manner required by the open meetings act, 1976 PA 267, MCL 15.261 to 15.275.

(5) A writing prepared, owned, or used by an authority in the performance of an official function shall must be made available in compliance with the freedom of information act, 1976 PA 442, MCL 15.231 to 15.246.

(6) At its first meeting, a board shall elect a chairperson, a secretary, a treasurer, and any other officers it considers necessary. A board shall meet at least quarterly.

(7) A board may adopt bylaws to govern its procedures.

(8) A board may establish 1 or more committees to provide advice on specific issues relevant to the authority. The board may determine the qualifications required to serve on a committee created under this subsection. Members of a committee created by a board under this subsection serve at the pleasure of the board. Committees created under this subsection may create volunteer subcommittees that do not serve at the pleasure of the board.

Sec. 9. An authority may do 1 or more of the following, as permitted by the authority's articles:

(a) Acquire and hold, by purchase, lease with or without option to purchase, grant, gift, devise, land contract, installment purchase contract, bequest, or other legal means, real and personal property inside or outside the territory of the authority. The property may include franchises, easements, or rights of way on, under, or above any property. The authority may pay for the property from, or pledge for the payment of the property, revenue of the authority. The authority may acquire land from this state, including, but not limited to, land from any department, subdivision, or unit of this state.

(b) Apply for and accept grants or contributions from individuals, the federal government or any of its agencies, this state, a municipality, or other public or private agencies to be used for any of the purposes of the authority.

(d) Provide for the maintenance of all of the real and personal property of the authority.

(e) Assess and collect fees for use of and access to property that the authority owns or manages, and for services provided by and expenses incurred by the authority.

(f) Receive revenue as appropriated by the legislature of this state or a participating municipality or distribute funds of the authority to any participating municipality.

(g) Enter into contracts incidental to or necessary for the accomplishment of the purposes of the authority.

(h) Sell, lease, license, or develop real and personal property held by the authority.

(i) Establish an endowment fund or other type of supporting fund to support the purposes of the authority.

(j) Subject to applicable laws and contractual obligations of the authority, make and enforce rules for the use of property the authority owns, operates, or manages.

(k) Permit and manage sustainable natural resource commercial activities including, but not limited to, both of the following:

(i) The development, management, and operation of sustainable commercial forestry.

(ii) The sale of carbon or other environmental credits or tax attributes.

(l) Manage, maintain, and improve real and personal property inside or outside of the territory of the authority that is not owned by the authority.

(m) Develop, construct, repair, and replace improvements to property, including buildings.

(n) Sue or be sued in any court of this state.

Sec. 10. (1) Except as otherwise provided in this section, if an authority dissolves, all property, funds, and assets of the authority are vested in the participating municipality or municipalities. Except as otherwise provided in the articles of an authority, if an authority dissolves, the debts or liabilities of an authority do not become the debts or liabilities of the participating municipality or municipalities unless the participating municipality or municipalities have agreed to assume those debts or liabilities.

(2) If the property owned by an authority was designated by the authority as a public forest and natural resources area, on dissolution of the authority, the designated use of the property must be continued. If the designated use of the property is not continued by the participating municipality or municipalities, the property must revert to this state. The reversionary interest under this subsection is in addition to, and does not alter or supersede, any other reversionary interest the state may hold in the property.

(3) If property owned by an authority was designated by the authority as a public forest and natural resources area, the participating municipality or municipalities may elect to waive their right, in full or in part, to the property. If the participating municipality or municipalities waive their right, in full or in part, to the property, the property or portion of the property reverts to this state.

(4) If an authority was in existence before the effective date of the amendatory act that added this subsection and the authority's articles address the disposition of the authority's property, funds, and assets on dissolution, the articles control the disposition of the property, funds, and assets on dissolution.

(5) Nothing in this act alters or supersedes any third-party rights, including rights of the state or federal government, in or attached to the property owned by an authority.

Sec. 11. (1) An authority may levy a tax of not more than 1 mill for a period of not more than 20 years on all of the taxable property within the territory of the authority for the purposes of acquiring, constructing, operating, maintaining, and improving a public swimming pool, public recreation center, public auditorium or conference center, or public park, or public forest and natural resources area. The authority may levy the tax only upon on the approval of a majority of the electors in each of the participating municipalities of the authority voting on the tax on November 6, 2001 or, thereafter, at a statewide general or primary election. The proposal for a tax shall must be submitted to a vote of the electors of the authority by resolution of the board.

(2) A ballot proposal for a tax shall must state the amount and duration of the millage and the purposes for which the millage may be used. A proposal for a tax shall must not be placed on the ballot unless the proposal is adopted by a resolution of the board and certified by the board not later than 60 days before the election to the county clerk of each county in which all or part of the territory of the authority is located for inclusion on the ballot. The proposal shall must be certified for inclusion on the ballot at the next eligible election, as specified by the board's resolution.

(3) If a majority of the electors in each of the participating municipalities of the authority voting on the question of a tax approve the proposal as provided under subsection (1), the tax levy is authorized. Not more than 2 elections may be held in a calendar year on a proposal for a tax authorized under this act.

(4) The proceeds of a tax levied under this section shall must only be used by the authority for those purposes described in this section and shall must not be used by the authority for either of the following:

(a) Except as otherwise provided in subsection (5), any general fund purposes by any participating municipality.

(b) Any school operating purposes, as that term is defined in section 20 of the state school aid act of 1979, 1979 PA 94, MCL 388.1620, by any participating municipality that is a school district.

(5) The proceeds of a tax levied under this section may be used for general fund purposes by a participating municipality if the proceeds used are directly related to managing the operation of the business of the authority pursuant to a contract between the authority and that participating municipality.

Sec. 21. (1) An authority may borrow money and issue bonds or notes to finance the acquisition, construction, and improvement of a public swimming pool, a public recreation center, a public auditorium, a public conference center, or a public park, or a public forest and natural resources area, including the acquisition of sites and the acquisition and installation of furnishings and equipment for these purposes.

(2) An authority shall not borrow money or issue bonds or notes for a sum that, together with the total outstanding bonded indebtedness of the authority, exceeds 2 mills of the taxable value of the taxable property within the district as determined under section 27a of the general property tax act, 1893 PA 206, MCL 211.27a.

(3) Bonds or notes issued by an authority are a debt of the authority and not of the participating municipalities.

(4) A tax levied to pay a bond or note obligation by a recreational authority under this act shall must not exceed 5 years without the approval of a majority of the electors in each of the participating municipalities of the authority.

(5) All bonds or notes issued by a recreational authority under this act are subject to the revised municipal finance act, 2001 PA 34, MCL 141.2101 to 141.2821.

Enacting section 1. This amendatory act does not take effect unless all of the following bills of the 103rd Legislature are enacted into law:

(a) Senate Bill No. ____ (request no. S01810'25 a) or House Bill No. ____ (request no. H01810'25 a).

(b) Senate Bill No. ____ (request no. S01811'25) or House Bill No. ____ (request no. H01811'25).