AUTHORITIES ACT
House Bill 4455
Sponsor: Rep. Patricia Lockwood
Committee: Tax Policy
Complete to 9-7-00
A SUMMARY OF HOUSE BILL 4455 AS INTRODUCED 4-13-99
The bill would create the Cultural and Recreational Authorities Act. Under this act, two or more municipalities in a county with a population of under 300,000 could establish a cultural and recreational authority, which with voter approval could levy a tax of not more than 3 mills for a period of not more than 20 years for the purposes of acquiring, operating, maintaining, or improving a public swimming pool, public recreation facility, public auditorium or conference center, or public park. The term "municipality" would refer to a city, village, or township.
The term "park" would refer to an area of land or water, or both, dedicated to open or scenic space; to environmental, conservation, nature, or wildlife areas; or to recreational purposes, including picnic grounds, playgrounds, athletic fields, campgrounds, zoological and botanical gardens, boating, fishing, and birding areas, swimming areas, and foot, bicycle, and bridal paths.
To establish an authority, articles of incorporation would have to be prepared and then adopted by a majority of the members serving on the legislative body of each participating municipality. Before the articles (or subsequent amendments) could be adopted, they would have to be published at least once in a newspaper generally circulated in the participating municipalities. Once adopted, the articles (or subsequent amendments) would have to be filed with the secretary of state by the clerk of the last municipality to adopt them, and they would take effect upon filing. The articles would address the name of the authority, its purposes, the participating municipalities, a description of the authority's territory, the size of its board, the procedure for joining and withdrawing from the authority, and other appropriate matters. The authority would be an authority under Section 6 of Article IX of the state constitution (which means the taxes it levied would not count toward certain constitutional limitations on ad valorem taxes).
The qualifications, method of selection, and terms of office of board members would be determined by the articles of incorporation. However, the articles would have to provide that the school board of each district lying totally or partially within the territory of the authority was entitled to appoint one member to the board of the authority. If board members were elected in at large elections with the voters of the participating municipalities voting collectively, the election would be conducted as prescribed in the bill (using the same procedures as the election involving a ballot proposal on a tax by the authority). A majority of the members would constitute a quorum, and official action could be taken upon the vote of a majority of the members present unless bylaws required a larger number. Board members would not receive compensation but would be entitled to reimbursement for reasonable expenses, including previously authorized travel. Board members could be removed by the appointing authority for good cause after a public hearing. Vacancies would be filled in the same manner as the original appointment. An authority would be subject to the Open Meetings Act and the Freedom of Information Act.
An authority would have the powers necessary to carry out its purposes, including the acquisition of property inside or outside its territory and the maintenance of property; the hiring of employees; the assessing and collecting of fees; the receipt of revenue from the state legislature or a participating municipality; and the acceptance of grants or contributions from individuals, the federal government, the state, a municipality, or other private and public agencies.
To the extent authorized by its articles, an authority could levy a tax of not more than 3 mills for up to 20 years on all of the taxable property within its territory only upon the approval of a majority of the electors of the authority voting collectively on the tax at a general or special election. The proposal for a tax would have to be submitted to the voters by resolution of the authority board. A ballot proposal would have to state the amount and duration of the millage and the general purposes for which it could be used. No more than two elections could be held in a calendar year on a tax proposal. The bill would specify how the election was to be conducted. The provisions are similar to those found in the Metropolitan Council Act. The tax would be collected with county taxes and distributed by the local tax collecting unit following the provisions of the General Property Tax Act.
An authority would be able to borrow money and issue bonds for its purposes not to exceed 2 mills of the taxable value of the taxable property within the authority's territory. Bonds or notes would be a debt of the authority and not of the participating municipalities. They would be subject to the Municipal Finance Act. General obligation unlimited tax bonds would require the approval of the voters. General obligation limited tax bonds could be issued by resolution of the authority board. An authority could issue bonds or notes for the purpose of refunding outstanding debt obligations by resolution of the board and refunding bonds would not be considered to be within the 2-mill limitation.
An authority board would be subject to the Uniform Budgeting and Accounting Act as regards annual audits, the preparation of budgets and appropriation acts, and the powers, duties, and immunities of the state treasurer, the attorney general, a prosecuting attorney, bank, certified public accountant or accounting firm, and others with respect to the authority. An authority that ended a year in a deficit condition would have to file a financial plan in the manner provided in the State Revenue Sharing Act. The board could authorize the funds of the authority to be invested or deposited in any investment or depository authorized under Section 1 of Public Act 20 of 1943, which governs the investment of surplus funds of political subdivisions.
Analyst: C. Couch