HB-5673, As Passed House, December 13, 2012HB-5673, As Passed Senate, December 12, 2012
SENATE SUBSTITUTE FOR
HOUSE BILL NO. 5673
A bill to amend 1994 PA 451, entitled
"Natural resources and environmental protection act,"
by amending sections 5201, 5202, 5203, and 5204 (MCL 324.5201,
324.5202, 324.5203, and 324.5204), section 5201 as amended by 2005
PA 257, sections 5202 and 5203 as added by 2002 PA 397, and section
5204 as amended by 2010 PA 232, and by adding section 5204e.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 5201. As used in this part:
(a) "Asset management program" means the program that
identifies the desired level of service at the lowest life cycle
cost for rehabilitating, repairing, or replacing the assets
associated with a municipality's wastewater or storm water system.
(b) (a)
"Authority" means the
Michigan municipal bond
authority created in section 4 of the shared credit rating act,
1985 PA 227, MCL 141.1054.
(c) (b)
"Department" means the
department of environmental
quality.
(d) (c)
"Fund" means the
strategic water quality initiatives
fund created in section 5204.
(e) (d)
"Grant" means a grant
from the grant program.
(f) (e)
"Grant program" means the
strategic water quality
initiatives
grant program established under section 5204a.this
part.
(g) (f)
"Loan" means a loan from
the loan program.
(h) (g)
"Loan program" means the
strategic water quality
initiatives loan program established under section 5202.
(i) (h)
"Municipality" means that
term as it is defined in
section 5301.
(j) (i)
"On-site septic system"
means a natural system or
mechanical device used to store, treat, and dispose of sewage from
1 or more dwelling units that utilize a subsurface trench or bed
that allows the effluent to be absorbed and treated by the
surrounding soil, including a septic tank and tile field system.
(k) (j)
"State water pollution control
revolving fund" means
the state water pollution control revolving fund established under
section 16a of the shared credit rating act, 1985 PA 227, MCL
141.1066a.
(l) "Wetland mitigation bank" means a site where wetlands are
restored, created, or preserved for the purpose of doing both of
the following:
(i) To provide compensatory mitigation in accordance with the
provisions of part 303, in advance of authorized, unavoidable
impacts to wetlands.
(ii) To provide storm water control, nonpoint source pollution
control, or pollution treatment that improves the quality of the
waters of the state.
Sec. 5202. (1) The authority in consultation with the
department shall establish a strategic water quality initiatives
loan program. This loan program shall provide low interest loans to
municipalities
to provide assistance for improvements to a sewage
system
for 1 or more of the following:
(a) Improvements to reduce or eliminate the amount of
groundwater or storm water entering a sanitary sewer lead or a
combined sewer lead.
(b) Upgrades or replacements of failing on-site septic systems
that are adversely affecting public health or the environment, or
both.
(c) Project costs of the municipality related to testing,
demonstration, and construction activities as defined in section
5301(d) for innovative wastewater and storm water technologies
approved by the department.
(d) Assistance for construction activities as defined in
section 5301(d) designed to protect water quality, including
improvements that are water or energy efficient, where feasible,
when identified through an asset management program or a project
identified in an approved storm water management plan.
(2) The department shall develop criteria specifying the
content of an asset management program.
(3) (2)
In implementing the loan program,
the department shall
annually establish the interest rate that will be charged for
loans.
Sec. 5203. (1) A municipality that wishes to apply for a loan
shall
submit a loan application to the department in accordance
with
the application requirements provided in part 53.as follows:
(a) In compliance with the application requirements provided
in part 53, for activities described in section 5202(1)(a) or (b).
(b) On a form approved by the department, for activities
described in section 5202(1)(c) or (d).
(2) The department shall process the loan applications
submitted
under this part. and otherwise administer the fund in
accordance
with the procedures established pursuant to part 53.
(3) Prior to releasing a loan, the authority in consultation
with the department shall enter into a loan agreement with the loan
recipient. in
accordance with part 53.
(4) All money that is received for the repayment of a loan
shall be forwarded to the state treasurer for deposit into the
fund.
Sec. 5204. (1) The strategic water quality initiatives fund is
created within the state treasury.
(2) The state treasurer may receive money or other assets from
any source for deposit into the fund. The state treasurer shall
direct the investment of the fund. The state treasurer shall credit
to the fund interest and earnings from fund investments. The
authority shall act as fiscal agent for the fund in accordance with
the shared credit rating act, 1985 PA 227, MCL 141.1051 to
141.1076.
(3) Money in the fund at the close of the fiscal year shall
remain in the fund and shall not lapse to the general fund.
(4) The authority in consultation with the department shall
expend money from the fund, upon appropriation, only for the
following:
(a) Loans under section 5202.
(b)
Grants under section sections
5204a, and 5204d, and 5204e.
(c) Response activities to address nonpoint source water
pollution under section 5204b.
(d) Grants and loans for brownfield sites under section 5204c.
(e) Grants and loans for wetland mitigation banks under
section 5204f.
(f) (e)
The costs of the authority and the
department in
administering the fund.
(5) The fund may be pledged as security for bonds to be issued
by the authority for the purpose of funding loans if authorized by
the state administrative board.
Sec. 5204e. (1) In addition to other requirements of this
part, the grant program shall provide grants to municipalities for
sewage collection and treatment systems or storm water or nonpoint
source pollution control as provided for in this section.
(2) The grant program is subject to all of the following:
(a) The grant program shall provide grants in accordance with
the following:
(i) Subject to subparagraph (iii), for grants of up to
$1,000,000.00, not more than 90% of the costs incurred by the
municipality.
(ii) Subject to subparagraph (iii), for grants of more than
$1,000,000.00 and less than $2,000,000.00, not more than 90% of the
costs incurred by the municipality up to $1,000,000.00 and not more
than 75% of the costs above $1,000,000.00 incurred by the
municipality.
(iii) If any of the following conditions are met, a grant may be
issued to cover 100% of the costs incurred by the municipality:
(A) The municipality is a disadvantaged community as defined
in part 53.
(B) The municipality is in receivership.
(C) The municipality is operating under an emergency manager
or an emergency financial manager appointed under state law.
(D) The municipality is operating under a consent agreement as
provided under the local government fiscal responsibility act, 1990
PA 72, MCL 141.1201 to 141.1291.
(b) A grant may be used for 1 or more of the following
purposes:
(i) Development of an asset management program for a sewage
collection and treatment system or a storm water system. For sewage
collection and treatment systems, the program shall include the
development of a funding structure and implementation schedule that
provides sufficient resources to implement the program. The
municipality shall coordinate, as feasible, with other
infrastructure activities in the same geographic area. In addition,
a disadvantaged community may expend not more than $500,000.00 in
grant funds to implement projects identified in the asset
management program.
(ii) Development of management plans for the treatment of storm
water.
(iii) Planning and design of a sewage treatment works project or
stormwater treatment project as defined in section 5301(n) or (o)
or planning and design of construction activities designed to
reduce nonpoint source pollution.
(iv) Project costs of a municipality related to the testing and
demonstration of innovative wastewater and storm water technologies
approved by the department.
(c) The local match is not eligible for loan assistance from
the state water pollution control revolving fund or the fund.
(d) Grant funds shall not be used for general local government
administrative activities or activities performed by municipal
employees that are unrelated to the project.
(e) A municipality shall not receive more than $2,000,000.00
in total grant assistance under this section.
(3) The department shall establish an application and review
process for considering grant applications under this section. The
application shall contain the information required by the
department and the authority. Within 60 days after receipt of an
application, the department shall publish notice of the application
on the department's calendar. Within 120 days after receipt of an
administratively complete grant application, the department shall,
in writing, notify the applicant whether the application is
approved or rejected. If the department approves a grant under this
section, the department and the authority shall enter into a grant
agreement with the recipient prior to transferring funds. The grant
agreement shall contain terms established by the department and the
authority, including both of the following:
(a) A requirement that a grant recipient proceed with a
project for which grant funding is provided within 3 years after
the department approves the grant. For asset management programs
related to sewage collection and treatment systems, this includes
significant progress, as determined by the department, toward
achieving the funding structure necessary to implement the program.
(b) A requirement that the grant recipient repay the grant,
within 90 days of being informed to do so, with interest at a rate
not to exceed 8% per year, to the authority for deposit into the
fund if the applicant is unable to, or decides not to, proceed with
a construction project or begin implementation of an asset
management program for which grant funding is provided.
(4) For each year in which the department receives grant
applications under this section, the department shall report by
October 1 of that year to the standing committees of the senate and
the house of representatives with primary jurisdiction over issues
pertaining to natural resources and the environment and to the
senate and house of representatives appropriations committees on
the utilization of funds under this part that were received from
the Great Lakes water quality bond fund created in section 19706.
The report shall include, at a minimum, all of the following:
(a) The number of grant applications received under this
section.
(b) The name of each municipality applying for a grant.
(c) The type of project being funded for each grant awarded.
(d) The number of users potentially affected by each grant
awarded.
(e) The amount of the local match for each grant awarded.
(f) The individual and annual cumulative amount of grant funds
awarded, including an identification of whether each award was for
the purpose of applying for assistance from the state water
pollution control revolving fund or the fund.
Enacting section 1. This amendatory act does not take effect
unless all of the following bills of the 96th Legislature are
enacted into law:
(a) Senate Bill No. 1155.
(b) Senate Bill No. 1156.
(c) Senate Bill No. 1157.
(d) Senate Bill No. 1158.