HOUSE BILL No. 5316 February 8, 2000, Introduced by Reps. Jellema, Caul, Gilbert, Scranton, Stamas, Byl, DeWeese, Bovin, Tesanovich, Ehardt, Mans, Prusi, Pestka, Callahan, LaSata, Mortimer, Kuipers and Birkholz and referred to the Committee on Local Government and Urban Policy. A bill to authorize certain governmental units to issue notes or bonds for planning for the acquisition, construction, improvement, or installation of safe drinking water facilities; to provide security for the payment of the principal of and interest on the notes or bonds; and to prescribe the powers and duties of certain governmental units. THE PEOPLE OF THE STATE OF MICHIGAN ENACT: 1 Sec. 1. This act shall be known and may be cited as the 2 "safe drinking water financial assistance act". 3 Sec. 2. As used in this act: 4 (a) "Assistance" means that term as it is defined in part 54 5 of the natural resources and environmental protection act, 1994 6 PA 451, MCL 324.5401 to 324.5418. 02772'99 * JCB 2 1 (b) "Community water supply" means that term as it is 2 defined in part 54 of the natural resources and environmental 3 protection act, 1994 PA 451, MCL 324.5401 to 324.5418. 4 (c) "Department" means the department of environmental 5 quality. 6 (d) "Governmental unit" means a governmental unit as defined 7 in section 3 of the shared credit rating act, 1985 PA 227, 8 MCL 141.1053, that is eligible for reimbursement of project plan- 9 ning costs under section 5404(3)(b) of the natural resources and 10 environmental protection act, 1994 PA 451, MCL 324.5404. 11 (e) "Noncommunity water supply" means that term as it is 12 defined in part 54 of the natural resources and environmental 13 protection act, 1994 PA 451, MCL 324.5401 to 324.5418. 14 (f) "Water supplier" means that term as it is defined in 15 part 54 of the natural resources and environmental protection 16 act, 1994 PA 451, MCL 324.5401 to 324.5418. 17 Sec. 3. Subject to this act, a governmental unit may issue 18 notes or bonds and use the proceeds of the notes or bonds for 19 planning for the acquisition, construction, improvement, or 20 installation of real or personal property comprising all or a 21 portion of a community water supply or noncommunity water supply 22 or for the refunding or advance refunding of notes or bonds pre- 23 viously issued under this act, and for the payment of the costs 24 of issuing the notes or bonds. For any governmental unit, the 25 aggregate principal amount of all notes and bonds issued under 26 this act less the principal amount used by the governmental unit 27 to purchase notes or bonds issued by another governmental unit 02772'99 * 3 1 under this act shall not exceed $100,000.00. Subject to 2 section 5, the issuance of notes or bonds under this act is not 3 subject to any right of referendum, notwithstanding any other 4 statutory or charter provision to the contrary. The notes or 5 bonds issued under this act shall be sold to the Michigan munici- 6 pal bond authority or to another governmental unit if the other 7 governmental unit purchases the notes or bonds with proceeds of 8 notes or bonds issued under this act and sold to the Michigan 9 municipal bond authority. The notes or bonds issued under this 10 act are not subject to the municipal finance act, 1943 PA 202, 11 MCL 131.1 to 139.3. Subject to this act, each governmental unit 12 is authorized to use proceeds of notes or bonds issued by it 13 under this act and sold to the Michigan municipal bond authority 14 to purchase notes or bonds issued under this act by any other 15 governmental unit. 16 Sec. 4. Notes or bonds issued under this act shall be 17 authorized by a resolution of the governing body of the govern- 18 mental unit, which may pledge the full faith and credit of the 19 governmental unit to the payment of the principal of and interest 20 on the notes or bonds. The governmental unit may establish 21 interest rates or methods for establishing interest rates, 22 prices, discounts, maturities, principal amounts, denominations, 23 dates of issuance, interest payment dates, optional or mandatory 24 redemption or tender rights, obligations to be exercised by the 25 governmental unit or the holders of the notes or bonds, the place 26 of delivery and payment, and other matters and procedures 27 necessary or desirable in connection with the issuance of the 02772'99 * 4 1 notes or bonds. A governmental unit may secure the notes or 2 bonds with additional security as determined by the governing 3 body of the governmental unit, including, but not limited to, a 4 pledge or assignment of any school aid payments, revenue sharing 5 payments or similar payments to be received from the state, a 6 letter of credit, a line of credit, or an insurance contract. 7 Subject to section 5, the governing body of the governmental unit 8 authorizing the issuance of notes or bonds under this act may 9 provide in the authorizing resolution that it is the duty of each 10 officer and official of the governmental unit that issues notes 11 or bonds authorized by this act, who is charged with such duty, 12 to include in the annual taxes levied an amount such that the 13 estimated collections thereof shall be sufficient to pay when due 14 all payments of the principal of and interest on the notes or 15 bonds due prior to the collection of the following year's taxes 16 after taking into account money on hand or expected to be on hand 17 for such payments from all sources. The governing body of the 18 governmental unit shall include in its budget and pay such sum or 19 sums that may be necessary each year to pay the principal of and 20 the interest on the notes or bonds when and as the notes or bonds 21 become due, including overdue installments or maturities. The 22 resolution of the governing body of the governmental unit autho- 23 rizing the issuance of notes or bonds under this act may autho- 24 rize the governmental unit to enter into loan agreements, secur- 25 ity agreements, pledge agreements, mortgages, assignments, or 26 other agreements determined to be necessary to the issuance of 27 the notes or bonds and may authorize the governmental unit to use 02772'99 * 5 1 proceeds of the notes or bonds sold to the Michigan municipal 2 bond authority to purchase notes or bonds issued under this act 3 by any other governmental unit. 4 Sec. 5. This act shall be construed as cumulative authority 5 for the exercise of the powers granted under this act. The pur- 6 pose of this act is to create full and complete additional and 7 alternate methods for the exercise of these powers, and the 8 powers conferred by this act shall not be affected or limited by 9 any other statute or by any charter or incorporating document, 10 except as otherwise provided in this act. However, this act does 11 not authorize the governing body of any governmental unit to levy 12 taxes in excess of constitutional, statutory, or charter limita- 13 tions without the approval of its electors, as provided by law. 14 Enacting section 1. This act takes effect October 1, 2000. 02772'99 * Final page. JCB