May 24, 2012, Introduced by Reps. Pscholka, Opsommer, MacGregor and Kowall and referred to the Committee on Natural Resources, Tourism, and Outdoor Recreation.
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 sections 5204e and
5204f.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 5201. As used in this part:
(a) "Asset management program" means the system 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 stormwater 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, in exceptional circumstances, preserved
expressly for the purpose of providing compensatory mitigation in
accordance with the provisions of part 303, in advance of
authorized, unavoidable impacts to wetlands.
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) Assistance for construction activities as defined in
section 5301(d) when identified through an asset management program
or storm water project plan designed to protect water quality,
including improvements that are water and energy efficient, where
feasible.
(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.in compliance
with the following:
(a) To the department in accordance with the application
requirements provided in part 53 for section 5202(1)(a) or (b)
activities.
(b) On a form approved by the department for section
5202(1)(c) activities.
(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 assistance to municipalities
to increase the level of investment in sewage collection and
treatment systems and to improve water quality and result in
pollution prevention.
(2) The grant program is subject to all of the following:
(a) The grant program shall provide grants of up to
$1,000,000.00 to cover not more than 90% of the costs incurred by a
municipality. For grants of more than $1,000,000.00 and less than
$2,000,000.00, the grant program shall not cover more than 75% of
the costs incurred by a municipality. A municipality that is a
disadvantaged community as defined in part 53 or a municipality
under emergency financial management under the local government and
school district fiscal accountability act, 2011 PA 4, MCL 141.1501
to 141.1531, a consent agreement entered into under that act, or a
successor statute that the department determines is substantially
similar to that act, may receive a 100% grant. Funding can be used
for 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.
(ii) Development of management plans for the treatment of storm
water.
(iii) Development of storm water utilities if the municipality
has an asset management program.
(iv) Planning and design of a sewage treatment works project or
stormwater treatment project as defined in section 5301(n) or (o)
or construction activities designed to reduce nonpoint source
pollution.
(b) The local match is not eligible for loan assistance from
the state water pollution control revolving fund or the fund.
(c) Grant funds shall not be used for general local government
administrative activities or activities performed by municipal
employees that are unrelated to the project.
(d) 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 and 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 initiated from a grant under this
section.
(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.
Sec. 5204f. (1) The authority, in conjunction with the
department, shall establish a wetland mitigation bank funding
program that provides grants and loans totaling not more than
$10,000,000.00 to eligible municipalities. Of the money expended
under this subsection, up to $500,000.00 may be used for grants.
Funding may be used for the purpose of this subsection as long as
funds remain available.
(2) Grants awarded under the wetland mitigation bank funding
program shall provide assistance to municipalities to complete loan
application requirements for funding from the wetland mitigation
bank funding program or to complete loan application requirements
for other sources of financing. Grants for wetland mitigation banks
are subject to the following:
(a) Grants shall not cover more than 90% of the costs incurred
by a municipality to complete an application for loan assistance.
(b) Grant funding may be used for the following purposes:
(i) Developing an approvable wetland mitigation banking
proposal.
(ii) Notifying affected local units of government and adjacent
property owners of the proposed wetland mitigation bank, and
working to resolve objections to the project.
(iii) Planning and designing the wetland mitigation bank.
(iv) Completing the wetland mitigation bank funding program
loan application or loan application requirements for other sources
of financing.
(c) The 10% local match is not eligible for loan assistance
from the wetland mitigation funding bank program.
(d) Grant funds shall not be used for general local government
administrative activities or activities performed by municipal
employees that are unrelated to development of the wetland
mitigation bank loan application.
(e) Applications for grants from the wetland mitigation
funding bank program shall be made on a form provided by the
department and shall contain the information required by the
department and the authority. Grant applications may be made at any
time.
(f) The department shall establish a review process for
considering grant applications under this subsection. The
department shall notify the applicant in writing 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.
(g) The grant agreement shall contain terms established by the
department and the authority and 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 any of the following occur:
(i) The applicant fails to submit an administratively complete
loan application for assistance from the wetland mitigation bank
funding program or other source of financing for the project within
1 year of the date on which the grant expires.
(ii) The applicant declines the loan assistance for 2
consecutive years unless the applicant proceeds with funding from
another source.
(iii) The applicant is unable to enter into a signed wetland
mitigation banking agreement with the department within 2 years of
the date on which the grant expires.
(iv) The applicant is unable to or decides not to proceed with
constructing the project.
(3) Loans under the wetland mitigation bank funding program
shall provide assistance to municipalities to establish a wetland
mitigation bank. Loans shall be subject to the following:
(a) Loans under the wetland mitigation bank funding program
shall be for 1 or more of the following:
(i) Complete and execute the wetland mitigation banking
agreement with the department.
(ii) Complete engineering and design for the wetland mitigation
bank.
(iii) Purchase land for the wetland mitigation bank.
(iv) Construct the wetland mitigation bank.
(v) Conduct monitoring and maintenance necessary to ensure
that the performance standards are or will be met.
(vi) In addition, the department may approve the use of loan
funds for other activities needed to establish a wetland mitigation
bank upon a demonstrated need by the municipality.
(b) Applications for loans from the wetland mitigation bank
funding program shall be made on a form provided by the department
and shall contain the information required by the department and
the authority. Loan applications may be made at any time.
(4) The department shall establish a review process for
considering loan applications under this subsection. The department
shall notify the applicant in writing whether the loan is approved
or rejected. Prior to releasing a loan, the authority in
consultation with the department shall enter into a loan agreement
with the loan recipient.
(5) For each year in which the department receives grant or
loan applications under this section, the department shall report
by October 1 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 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 and loan applications received under
this section.
(b) The name of each municipality applying for a grant or
loan, or both.
(c) The amount of local match for each grant awarded.
(d) The individual and annual cumulative amount of grant and
loan funds awarded, including an identification of the purpose of
each grant and loan awarded.
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.____ or House Bill No. 5674(request no.
05374'12 *).
(b) Senate Bill No.____ or House Bill No. 5675(request no.
05375'12 *).
(c) Senate Bill No.____ or House Bill No. 5676(request no.
05376'12 *).