HOUSE BILL No. 6062


     May 9, 2002, Introduced by Reps. LaSata, Stamas, Godchaux, Meyer and Neumann and referred to the Committee on Local
Government and Urban Policy.


        A bill to amend 1987 PA 230, entitled

   "Municipal health facilities corporations act,"

   by amending section 305 (MCL 331.1305), as amended by 1988 PA

   502.

               THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

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             Sec. 305.  Subject to applicable licensing and other regula-

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        tory requirements, a local governmental unit may do any or all of

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        the following:

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             (a) Acquire health care facilities by purchase, gift,

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        devise, lease, sublease, installment purchase agreement, land

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        contract, option, or other means; construct, add to, repair,

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        remodel, renovate, equip, and re-equip health care facilities for

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        use, in whole or in part, by a corporation or a subsidiary

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        corporation; borrow money and issue bonds in accordance with  Act

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        No. 118 of the Public Acts of 1923, being sections 141.61 to


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        141.66 of the Michigan Compiled Laws  1923 PA 118, MCL 141.61 TO

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        141.66; enter into contracts of lease  pursuant to Act No. 31 of

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        the Public Acts of the First Extra Session of 1948, being sec-

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        tions 123.951 to 123.965 of the Michigan Compiled Laws  UNDER

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        1948 (1ST EX SESS) PA 31, MCL 123.951 TO 123.965; or enter into

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        obligations  pursuant to  UNDER other applicable  law for such

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        purposes  LAWS TO ACQUIRE HEALTH CARE FACILITIES.  However,

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        whether or not otherwise permitted by law, a local governmental

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        unit shall not borrow funds,  from,  lease property,  from,  or

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        acquire property pursuant to a lease purchase agreement with a

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        local hospital authority incorporated under the hospital finance

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        authority act,  Act No. 38 of the Public Acts of 1969, being

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        sections 331.31 to 331.84 of the Michigan Compiled Laws  1969 PA

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        38, MCL 331.31 TO 331.84, nor shall a local governmental unit

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        otherwise receive the proceeds of bonds issued by  such  a local

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        hospital authority, except as consideration for property trans-

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        ferred by the local governmental unit to a third party.  Any

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        bonding proposal requiring approval of the electors of a local

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        governmental unit may be presented at the same election described

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        in sections 201 and 202 or sections 251 and 252.

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             (b) Transfer or make available health care facilities and

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        other real and personal property to a corporation or a subsidiary

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        corporation by sale, lease, sublease, installment sale agreement,

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        contract, or other means on  such  terms, with or without mone-

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        tary consideration,  as  APPROVED BY the county board of commis-

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        sioners, city council, or village council.  approves.  A health

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        care facility owned and operated by a corporation or a subsidiary



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        corporation shall not be considered to be owned or operated by

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        the local governmental unit.

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             (c) Grant mortgages, security interests, and other liens in,

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        pledge or sell and lease back its interests in health care facil-

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        ities and other real and personal property  in order  to secure

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        bonds, notes, or other obligations of a corporation or subsidiary

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        corporation, upon  such  terms  as  APPROVED BY the county board

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        of commissioners, city council, or village council.  approves.

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        The amount of the bonds, notes, or other obligations shall not be

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        included in computing the net bonded indebtedness of the local

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        governmental unit for the purposes of debt limitations imposed by

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        any constitutional, statutory, or charter provision, unless the

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        LOCAL GOVERNMENTAL UNIT PLEDGES full faith and credit  of the

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        local governmental unit is pledged  to the payment of the bond,

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        note, or other obligation.

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             (d) Guarantee any corporation obligation, bond, note, or

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        other obligation of a corporation or a subsidiary corporation on

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         such  terms  as  APPROVED BY the county board of commissioners,

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        city council, or village council,  approves,  and pledge speci-

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        fied revenues or assets of the local governmental unit or the

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        full faith and credit of the local governmental unit to the pay-

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        ment of  such  THE guaranty.  The resolution of the county board

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        of commissioners, city council, or village council approving any

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        guaranty which pledges the full faith and credit of the local

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        governmental unit shall contain a proviso that  it  THE

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        RESOLUTION shall not become effective and binding upon the local

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        governmental unit until it has been approved by a majority of the



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        electors voting at a special or regular local governmental unit

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        election.  The election proceedings under this subdivision shall

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        be conducted in accordance with the Michigan election law,  Act

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        No. 116 of the Public Acts of 1954, being sections 168.1 to

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        168.992 of the Michigan Compiled Laws  1954 PA 116, MCL 168.1 TO

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        168.992.  The amount of any  such  bonds, notes, or other obliga-

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        tions secured by a guaranty  which  THAT pledges the full faith

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        and credit of the local governmental unit shall be included in

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        computing the net bonded indebtedness of the local governmental

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        unit for the purposes of debt limitations imposed by any consti-

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        tutional, statutory, or charter provision.

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             (e) Loan to a corporation or a subsidiary corporation  such

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        amounts of  money from the general fund of the local governmental

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        unit or from funds not raised by taxation available to  it  THE

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        LOCAL GOVERNMENTAL UNIT for  such purposes as are necessary for

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        THE acquisition of or improvements to health care facilities,

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        operation of health services or for any other purpose of  such

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        THE corporation or subsidiary corporation, and enter into agree-

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        ments with the borrowing corporation or subsidiary corporation

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        for the repayment of  such  THOSE loans over a term not to exceed

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        30 years, with or without security.

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             (f) Appropriate money and transfer  such  THE money to 1 or

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        more corporations or subsidiary corporations established by the

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        local governmental unit for the acquisition of or improvements to

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        health care facilities, operation of health services, or any

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        other purpose of the corporations or subsidiary corporations.

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         However, the  THE total sums appropriated for  such  THOSE



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        purposes each year from the general fund of the local

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        governmental unit  shall not exceed 5% of the general fund, but

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        the 5%  shall be in addition to any taxes and appropriations to

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        satisfy local governmental unit indebtedness under bonds, notes,

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        or guaranties described in subdivisions (a) and (d).  Money may

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        be appropriated from funds not raised by taxation and available

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        to the local governmental unit for  such  THOSE purposes without

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        limitation.

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             (g) Notwithstanding subdivision (f), a county with a county

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        public hospital organized and operated under  Act No. 109 of the

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        Public Acts of 1945, being sections 331.201 to 331.213 of the

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        Michigan Compiled Laws, or Act No. 177 of the Public Acts of

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        1925, being sections 332.151 to 332.164 of the Michigan Compiled

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        Laws  1945 PA 109, MCL 331.201 TO 331.213, OR 1925 PA 177, MCL

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        332.151 TO 332.164, on February 27, 1988 may assess taxes not to

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        exceed in any 1 year 1 mill on each dollar of assessed valuation

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        of the county for the purpose of acquisition, construction, and

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        operation of any health care facilities without a vote of county

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        electors, and may appropriate money from its general fund for

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         such purposes  THE ACQUISITION, CONSTRUCTION, AND OPERATION OF

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        ANY HEALTH CARE FACILITIES without limitation.

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             (h) Enter into agreements or arrangements for a corporation

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        or a subsidiary corporation to provide health services to local

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        governmental unit employees, dependents of local governmental

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        unit employees, indigents, or others, providing for payment for

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         such  health services in any of the ways described in section

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        303(g).



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             (i) Sell,  to,  contract,  for,  or make available to

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        corporations or subsidiary corporations established by the local

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        governmental unit, administrative, management, and other services

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        necessary or convenient to  the fulfillment of  FULFILL the pur-

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        poses of the corporation or subsidiary corporation, and purchase

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         such  THE services from a corporation or subsidiary corporation

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         as  THAT may be required for any local governmental unit

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        purpose.








































   06826'02          Final page.                            KAO