HOUSE BILL No. 4848

 

April 29, 2009, Introduced by Reps. Sheltrown and Mayes and referred to the Committee on Transportation.

 

     A bill to amend 1951 PA 51, entitled

 

"An act to provide for the classification of all public roads,

streets, and highways in this state, and for the revision of that

classification and for additions to and deletions from each

classification; to set up and establish the Michigan transportation

fund; to provide for the deposits in the Michigan transportation

fund of specific taxes on motor vehicles and motor vehicle fuels;

to provide for the allocation of funds from the Michigan

transportation fund and the use and administration of the fund for

transportation purposes; to set up and establish the truck safety

fund; to provide for the allocation of funds from the truck safety

fund and administration of the fund for truck safety purposes; to

set up and establish the Michigan truck safety commission; to

establish certain standards for road contracts for certain

businesses; to provide for the continuing review of transportation

needs within the state; to authorize the state transportation

commission, counties, cities, and villages to borrow money, issue

bonds, and make pledges of funds for transportation purposes; to

authorize counties to advance funds for the payment of deficiencies

necessary for the payment of bonds issued under this act; to

provide for the limitations, payment, retirement, and security of

the bonds and pledges; to provide for appropriations and tax levies

by counties and townships for county roads; to authorize

contributions by townships for county roads; to provide for the

establishment and administration of the state trunk line fund,

local bridge fund, comprehensive transportation fund, and certain

other funds; to provide for the deposits in the state trunk line


fund, critical bridge fund, comprehensive transportation fund, and

certain other funds of money raised by specific taxes and fees; to

provide for definitions of public transportation functions and

criteria; to define the purposes for which Michigan transportation

funds may be allocated; to provide for Michigan transportation fund

grants; to provide for review and approval of transportation

programs; to provide for submission of annual legislative requests

and reports; to provide for the establishment and functions of

certain advisory entities; to provide for conditions for grants; to

provide for the issuance of bonds and notes for transportation

purposes; to provide for the powers and duties of certain state and

local agencies and officials; to provide for the making of loans

for transportation purposes by the state transportation department

and for the receipt and repayment by local units and agencies of

those loans from certain specified sources; and to repeal acts and

parts of acts,"

 

by amending section 12 (MCL 247.662), as amended by 2002 PA 498.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 12. (1) The amount distributed to the county road

 

commissions shall be returned to the county treasurers in the

 

manner, for the purposes, and under the terms and conditions

 

specified in this section. The department and the county road

 

association of Michigan shall jointly develop incentives for

 

counties to establish statewide purchasing pools for the more

 

efficient use of Michigan transportation funds.

 

     (2) Each county road commission shall be reimbursed in an

 

amount up to $10,000.00 per year for the sum paid to a licensed

 

professional engineer employed or retained by the county road

 

commission in the previous year. The sum shall be returned to each

 

county road commission certified by the state transportation

 

department as complying with this subsection regarding the

 

employment of an engineer.

 

     (3) An amount equal to 1% of the total amount returned to the

 

county road commissions from the Michigan transportation fund

 

during the prior calendar year shall be withheld annually from the


 

counties' November monthly distribution provided for in section 17,

 

and the amount shall be returned to the county road commissions for

 

snow removal purposes as provided in section 12a.

 

     (4) An amount equal to 10% of the total amount returned to the

 

county road commissions from the Michigan transportation fund shall

 

be returned to each county road commission having county primary,

 

or county local road, or both, mileage in the urban areas as

 

determined pursuant to section 12b. This sum shall be distributed

 

pursuant to section 12b. The return shall be in addition to the

 

amounts provided in subsections (6) and (7) and for the purposes

 

stated in those subsections.

 

     (5) An amount equal to 4% of the total amount returned to the

 

county road commissions from the Michigan transportation fund shall

 

be returned to the county road commissions in the same percentages

 

as provided in subsection (7). All money returned to the county

 

road commissions as provided in this subsection shall be expended

 

by the county road commissions for the preservation, construction,

 

acquisition, and extension of county local road systems and shall

 

be in addition to the amounts provided in subsection (7).

 

     (6) Seventy-five percent of the remainder of the total amount

 

to be returned to the counties shall be expended by each county

 

road commission for the preservation, construction, acquisition,

 

and extension of the county primary road system, including the

 

acquisition of a necessary right of way for the system, work

 

incidental to the system, and a roadside park or motor parkway

 

appurtenant to the system, and shall be returned to the counties as

 

follows:


 

     (a) Three-fourths of the amount in proportion to the amount

 

received within the respective county during the 12 months next

 

preceding the date of each monthly distribution, as specific taxes

 

upon registered motor vehicles under the Michigan vehicle code,

 

1949 PA 300, MCL 257.1 to 257.923.

 

     (b) One-tenth of the amount in the same proportion that the

 

total mileage in the county primary road system of each county

 

bears to the total mileage in all of the county primary road

 

systems of the state.

 

     (c) One eighty-third of the remaining 15% of the amount to

 

each county.

 

     (7) The balance of the remainder of the total amount to be

 

returned to counties shall be expended by each county road

 

commission for the preservation, construction, acquisition, and

 

extension of the county local road system as defined by this act,

 

including the acquisition of a necessary right of way for the

 

system, work incidental to the system, and a roadside park or motor

 

parkway appurtenant to the system, and shall be returned to the

 

counties as follows:

 

     (a) Sixty-five percent of the amount in the same proportion

 

that the total mileage in the county local road system of each

 

county bears to the total mileage in all of the county local road

 

systems of the state.

 

     (b) Thirty-five percent of the amount in the same proportion

 

that the total population outside of incorporated municipalities in

 

each county bears to the total population outside of incorporated

 

municipalities in all of the counties of the state, according to


 

the most recent statewide federal census as certified at the

 

beginning of the state fiscal year.

 

     (8) Money deposited in, or becoming a part of the county road

 

funds of a board of county road commissioners shall be expended

 

first for the payment of principal and interest on the bonds, for

 

the payment of contractual contributions pledged for the payment of

 

bonds, for debt service requirements for the payment of contractual

 

contributions pledged for the payment of bonds, and for debt

 

service requirements for the payment of notes and loans in the

 

following order of priority:

 

     (a) For the payment of contributions required to be made by a

 

board of county road commissioners under a contract entered into

 

under 1941 PA 205, MCL 252.51 to 252.64, which contributions have

 

been pledged for the payment of the principal and interest on bonds

 

issued under that act, or for the payment of total debt service

 

requirements upon notes issued by a board of county road

 

commissioners under 1943 PA 143, MCL 141.251 to 141.254.

 

     (b) For the payment of principal and interest upon bonds

 

issued under section 18c, and the payment of contributions of a

 

board of county road commissioners to be made pursuant to contracts

 

entered into under section 18d, which contributions are pledged to

 

the payment of principal and interest on bonds issued after June

 

30, 1957, under the authorization of section 18c and contracts

 

executed pursuant to its provisions.

 

     (c) For the payment of principal and interest upon loans

 

received pursuant to section 11(7), to the extent other funds have

 

not been made available for that payment.


 

     (9) Not to exceed 30% 50% per year of the amount returned to a

 

county for use on the county primary road system may be expended,

 

with or without matching, on the county local road system of that

 

county. Not to exceed 15% per year of the amount returned to a

 

county for expenditure on the county local road system may be used,

 

with or without matching, on the county primary road system of that

 

county, and not to exceed an additional 15% per year of the amount

 

returned to a county for expenditure on the county local road

 

system, may, in case of an emergency or with the approval of the

 

state transportation department, be expended, with or without

 

matching, on the county primary road system of that county. An

 

amount returned to a county for and on account of county local

 

roads, under this section, in excess of the total amount paid into

 

the county treasury each year by all of the townships of that

 

county for and on account of the county local roads pursuant to

 

section 14(6) may be transferred to and expended on the county

 

primary road system of that county.

 

     (10) Not less than 20% per year of the funds returned to a

 

county by this section shall be expended for snow and ice removal,

 

the construction or reconstruction of a new highway or existing

 

highway, and the acquisition of a necessary right of way for those

 

highways, and work incidental to those highways, or for the

 

servicing of bonds issued by the county for these purposes. Surplus

 

funds may be expended for the development, construction, or repair

 

of an off-street parking facility.

 

     (11) Not more than 5% per year of the funds returned to a

 

county for the county primary road system and the county local road


 

system shall be expended for the maintenance, improvement, or

 

acquisition of appurtenant roadside parks and motor parkways.

 

     (12) Funds returned to a county shall be expended by the

 

county road commission for the purposes provided in this section

 

and shall be deposited by the county treasurer in a designated

 

county depository, in a separate account to the credit of the

 

county road fund, and shall be paid out only upon the order of the

 

county road commission, and interest accruing on the money shall

 

become a part of, and be deposited with the county road fund.

 

     (13) In a county to which the funds are returned the function

 

of the county road commission shall be limited to the formation of

 

policy and the performance of the official duties imposed by law

 

and delegated by the county board of commissioners. A member of the

 

county road commission shall not be employed individually in any

 

other capacity for other duties with the county road commission.

 

     (14) A county road commission may enter into an agreement with

 

a county road commission of an adjacent county and with a city or

 

village to perform work on a highway, road, or street, and with the

 

state transportation department with respect to a state trunk line

 

and connecting links of the state trunk line within the limits of

 

the county or adjacent to the county. The agreement may provide for

 

the performance by each contracting party of the work contemplated

 

by the contract including engineering services and the acquisition

 

of rights of way in connection with the work contemplated, by

 

purchase or condemnation, by any of the contracting parties in its

 

own name and the agreement may provide for joint participation in

 

the costs.


 

     (15) Money distributed from the Michigan transportation fund

 

may be expended for construction purposes on county local roads

 

only to the extent matched by money from other sources. However,

 

Michigan transportation funds may be expended for the construction

 

of bridges on the county local roads in an amount not to exceed 75%

 

of the cost of the construction of local road bridges. This

 

subsection does not apply to section 11b.

 

     (16) Notwithstanding any other provision of this act, at least

 

90% of the state revenue returned annually to the county road

 

commission from the Michigan transportation fund less the amounts

 

described in subdivisions (a) to (e) shall be expended annually by

 

the county road commission for the preservation of highways, roads,

 

streets, and bridges, and for the payment of contractual

 

contributions pledged for the payment of bonds or portions of

 

bonds, debt service requirements for the payment of bonds or

 

portions of bonds, and debt service requirements for the payment of

 

notes and loans or portions of notes and loans issued or received

 

after July 1, 1983, for the purpose of providing funds for the

 

preservation of highways, roads, streets, and bridges. If an

 

appropriate certificate is filed under subsection (19) but only to

 

the extent necessary, this subsection shall not prohibit the use of

 

any amount of state revenue returned annually to the county road

 

commissions for the payment of contractual contributions pledged

 

for the payment of bonds, for debt service requirements for the

 

payment of bonds, and for debt service requirements for the payment

 

of notes or loans, whenever issued or received, as specified under

 

subsection (8). The amounts which are deducted from the state


 

revenue returned to a county road commission from the Michigan

 

transportation fund, for the purpose of the calculation required by

 

this subsection are as follows:

 

     (a) Amounts expended for the purposes described in subsection

 

(8) for bonds, notes, loans, or other obligations issued or

 

received before July 2, 1983.

 

     (b) Amounts expended for the administrative costs of the

 

county road commission.

 

     (c) Amounts expended for capital outlay projects for equipment

 

and buildings, and for the payment of contractual contributions

 

pledged for the payment of bonds, for debt service requirements for

 

the payment of bonds, and for debt service requirements for the

 

payment of notes and loans issued or received after July 1, 1983,

 

for the purpose of providing funds for capital outlay projects for

 

equipment and buildings.

 

     (d) Amounts expended for projects vital to the economy of the

 

local area or the safety of the public in the local area. Before

 

these amounts can be deducted, the governing body over the county

 

road commission or the county road commission, as applicable, shall

 

pass a resolution approving these projects. This resolution shall

 

state which projects will be funded and the cost of each project. A

 

copy of each approved resolution shall be forwarded immediately to

 

the department.

 

     (e) Amounts expended in urban areas as determined pursuant to

 

section 12b.

 

     (17) As used in this subsection, "urban routes" means those

 

portions of 2-lane county primary roads within an urban area which


 

has average daily traffic in excess of 15,000. Notwithstanding any

 

other provision of this act, except as provided in this subsection,

 

a county road commission shall expend annually at least 90% of the

 

federal revenue distributed to the use of the county road

 

commission for highways, roads, streets, and bridges, less the

 

amount expended on urban routes for other than preservation

 

purposes and the amount expended for hard-surfacing of gravel roads

 

on the federal-aid system, on the preservation of highways, roads,

 

streets, and bridges. A county road commission may expend in a year

 

less than 90% of the federal revenue distributed to the use of the

 

county road commission for highways, roads, streets, and bridges,

 

less the amount expended on urban routes for other than

 

preservation purposes and the amount expended for hard-surfacing of

 

gravel roads on the federal-aid system, on the preservation of

 

highways, roads, streets, and bridges, if that year is part of a 3-

 

year period in which at least 90% of the total federal revenue

 

distributed in the 3-year period to the use of the county road

 

commission for highways, roads, streets, and bridges, less the

 

amount expended on urban routes for other than preservation

 

purposes and the amount expended for hard-surfacing of gravel roads

 

on the federal-aid system, is expended on the preservation of

 

highways, roads, streets, and bridges. If a county road commission

 

expends in a year less than 90% of the federal revenue distributed

 

to the use of the county road commission for highways, roads,

 

streets, and bridges, less the amount expended on urban routes for

 

other than preservation purposes and the amount expended for hard-

 

surfacing of gravel roads on the federal-aid system, on the


 

preservation of highways, roads, streets, and bridges and that year

 

is not a part of a 3-year period in which at least 90% of the total

 

federal revenue distributed in the 3-year period to the use of the

 

county road commission for highways, roads, streets, and bridges,

 

less the amount expended on urban routes for other than

 

preservation purposes and the amount expended for hard-surfacing of

 

gravel roads on the federal-aid system, is expended on the

 

preservation of highways, roads, streets, and bridges, the county

 

road commission shall expend in each year subsequent to the 3-year

 

period 100%, or less in 1 year if sufficient for the purposes of

 

this subsection, of the federal revenue distributed to the use of

 

the county road commission for highways, roads, streets, and

 

bridges, less the amount expended on urban routes for other than

 

preservation purposes and the amount expended for hard-surfacing of

 

gravel roads on the federal-aid system, on the preservation of

 

highways, roads, streets, and bridges until the average percentage

 

spent on the preservation of highways, roads, streets, and bridges

 

in the 3-year period and the subsequent years, less the amount

 

expended on urban routes for other than preservation purposes and

 

the amount expended for hard-surfacing of gravel roads on the

 

federal-aid system, is at least 90%. A year may be included in only

 

one 3-year period for the purposes of this subsection. The

 

requirements of this subsection shall be waived if compliance would

 

cause the county road commission to be ineligible according to

 

federal law for federal revenue, but only to the extent necessary

 

to make the county road commission eligible according to federal

 

law for that revenue. For the purpose of the calculations required


 

by this subsection, the amount expended on urban routes by a county

 

road commission for other than preservation purposes and the amount

 

expended for hard-surfacing of gravel roads on the federal-aid

 

system shall be deducted from the total federal revenue distributed

 

to the use of the county road commission.

 

     (18) A county road commission shall certify, which

 

certification shall, for purposes of the validity of bonds and

 

notes, be conclusive as to the matters stated therein, to the state

 

transportation department on or before the issuance of any bonds or

 

notes issued after July 1, 1983, pursuant to 1943 PA 143, MCL

 

141.251 to 141.254, 1941 PA 205, MCL 252.51 to 252.64, or section

 

18c or 18d, for purposes other than the preservation of highways,

 

roads, streets, and bridges and purposes other than the purposes

 

specified in subsection (16)(c) that its average annual debt

 

service requirements for all bonds and notes or portions of bonds

 

and notes issued after July 1, 1983, for purposes other than the

 

preservation of highways, roads, streets, and bridges and other

 

than for the purposes specified in subsection (16)(c), including

 

the bond or note to be issued does not exceed 10% of the funds

 

returned to the county road commission pursuant to this act, less

 

the amounts specified in subsection (16)(a), (b), and (c) during

 

the last completed fiscal year of the county road commission. If

 

the purpose for which the bonds or notes are issued is changed

 

after the issuance of the notes or bonds, the change shall be made

 

in such a manner to maintain compliance with the certification

 

required by this subsection, as of the date the certificate was

 

originally issued, but no such change shall invalidate or otherwise


 

affect the bonds or notes with respect to which the certificate was

 

issued or the obligation to pay debt service on the bonds or notes.

 

     (19) In each charter county to which funds are returned under

 

this section, the responsibility for road improvement,

 

preservation, and traffic operation work, and the development,

 

construction, or repair of off-road parking facilities and

 

construction or repair of road lighting shall be coordinated by a

 

single administrator to be designated by the county executive who

 

shall be responsible for and shall represent the charter county in

 

transactions with the state transportation department pursuant to

 

this act.

 

     (20) Not more than 10% per year of all of the funds received

 

by and returned to a county from any source for the purposes of

 

this section may be expended for administrative expenses. A county

 

that expends more than 10% for administrative expenses in a year

 

shall be subject to section 14(5) unless a waiver is granted by the

 

department of treasury. As used in this subsection, "administrative

 

expenses" means those expenses that are not assigned including, but

 

not limited to, specific road construction or preservation projects

 

and are often referred to as general or supportive services.

 

Administrative expenses shall not include net equipment expense,

 

net capital outlay, debt service principal and interest, and

 

payments to other state or local offices which are assigned, but

 

not limited to, specific road construction projects or preservation

 

activities.

 

     (21) In addition to the financial compliance audits required

 

by law, the department of treasury shall conduct performance audits


 

and make investigations of the disposition of all state funds

 

received by county road commissions, county boards of

 

commissioners, or any other county governmental agency acting as

 

the county road authority, for transportation purposes to determine

 

compliance with the terms and conditions of this act. Performance

 

audits shall be conducted according to government auditing

 

standards issued by the United States general accounting office.

 

The department of treasury shall provide 6 months notice to the

 

county road commission or county board of commissioners, as

 

applicable, of the standards to be used for audits performed under

 

this subsection prior to the fiscal year in which the audit is

 

conducted. The department shall notify the county road commission

 

or county board of commissioners of any subsequent changes to the

 

standards. County road commissions or county boards of

 

commissioners, as applicable, shall make available to the

 

department of treasury the pertinent records for the audit.