November 28, 2006, Introduced by Senator JACOBS and referred to the Committee on Economic Development, Small Business and Regulatory Reform.
A bill to amend 2005 PA 280, entitled
"Corridor improvement authority act,"
by amending sections 2, 5, 6, 9, 18, 20, 22, 23, and 27 (MCL
125.2872, 125.2875, 125.2876, 125.2879, 125.2888, 125.2890,
125.2892, 125.2893, and 125.2897).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 2. As used in this act:
(a) "Advance" means a transfer of funds made by a municipality
to an authority or to another person on behalf of the authority in
anticipation of repayment by the authority. Evidence of the intent
to repay an advance may include, but is not limited to, an executed
agreement to repay, provisions contained in a tax increment
financing plan approved prior to the advance, or a resolution of
the authority or the municipality.
(b) "Assessed value" means the taxable value as determined
under section 27a of the general property tax act, 1893 PA 206, MCL
211.27a.
(c) "Authority" means a corridor improvement authority created
under this act.
(d) "Board" means the governing body of an authority.
(e) "Business district" means an area of a municipality zoned
and used principally for business.
(f) "Captured assessed value" means the amount in any 1 year
by which the current assessed value of the development area,
including the assessed value of property for which specific local
taxes
are paid in lieu of property taxes as determined in section
3(e)
3(d), exceeds the initial assessed value. The state tax
commission shall prescribe the method for calculating captured
assessed value.
(g)
"Chief executive officer" means the mayor or
city manager
of a city, the president of a village, or the supervisor of a
township.
(h) "Development area" means that area described in section 5
to which a development plan is applicable.
(i) "Development plan" means that information and those
requirements for a development area set forth in section 21.
(j) "Development program" means the implementation of the
development plan.
(k) "Fiscal year" means the fiscal year of the authority.
(l) "Governing body" or "governing body of a municipality"
means the elected body of a municipality having legislative powers.
(m) "Initial assessed value" means the assessed value, as
equalized, of all the taxable property within the boundaries of the
development
area at the time the ordinance resolution
establishing the tax increment financing plan is approved, as shown
by the most recent assessment roll of the municipality for which
equalization has been completed at the time the resolution is
adopted. Property exempt from taxation at the time of the
determination of the initial assessed value shall be included as
zero. For the purpose of determining initial assessed value,
property for which a specific local tax is paid in lieu of a
property tax shall not be considered to be property that is exempt
from taxation. The initial assessed value of property for which a
specific local tax was paid in lieu of a property tax shall be
determined
as provided in section 3(e) 3(d).
(n) "Land use plan" means a plan prepared under section 1 of
the city and village zoning act, 1921 PA 207, MCL 125.581, or the
township zoning act, 1943 PA 184, MCL 125.271 to 125.310.
(o) "Municipality" means 1 of the following:
(i) A city.
(ii) A village.
(iii) A township.
Sec. 5. A development area shall only be established in a
municipality and shall comply with all of the following criteria:
(a) Be
Is adjacent to or
is within 500 feet of a road
classified as an arterial or collector according to the federal
highway administration manual "Highway Functional Classification -
Concepts, Criteria and Procedures".
(b) Contain
Contains at least 10 contiguous parcels or at
least 5 contiguous acres.
(c) More than 1/2 of the existing ground floor square footage
in the development area is classified as commercial real property
under section 34c of the general property tax act, 1893 PA 206, MCL
211.34c.
(d) Residential use, commercial use, or industrial use has
been allowed and conducted under the zoning ordinance or conducted
in the entire development area, for the immediately preceding 30
years.
(e) Is presently served by municipal water and sewer.
(f) Zoned
Is zoned to allow for mixed use that includes
high-density residential use.
(g) The municipality agrees to all of the following:
(i) To expedite the local permitting and inspection process in
the development area.
(ii) To modify its master plan to provide for walkable
nonmotorized interconnections, including sidewalks and streetscapes
throughout the development area.
Sec. 6. (1) If the governing body of a municipality determines
that it is necessary for the best interests of the public to
redevelop its commercial corridors and to promote economic growth,
the governing body may, by resolution, declare its intention to
create and provide for the operation of an authority.
(2) In the resolution of intent, the governing body shall
state that the proposed development area meets the criteria in
section 5, set a date for a public hearing on the adoption of a
proposed ordinance
resolution creating the authority, and
designate the boundaries of the development area. Notice of the
public hearing shall be published twice in a newspaper of general
circulation in the municipality, not less than 20 or more than 40
days before the date of the hearing. Not less than 20 days before
the hearing, the governing body proposing to create the authority
shall also mail notice of the hearing to the property taxpayers of
record in the proposed development area, to the governing body of
each taxing jurisdiction levying taxes that would be subject to
capture if the authority is established and a tax increment
financing plan is approved, and to the state tax commission.
Failure of a property taxpayer to receive the notice does not
invalidate these proceedings. Notice of the hearing shall be posted
in at least 20 conspicuous and public places in the proposed
development area not less than 20 days before the hearing. The
notice shall state the date, time, and place of the hearing and
shall describe the boundaries of the proposed development area. A
citizen, taxpayer, or property owner of the municipality or an
official from a taxing jurisdiction with millage that would be
subject to capture has the right to be heard in regard to the
establishment of the authority and the boundaries of the proposed
development area. The governing body of the municipality shall not
incorporate land into the development area not included in the
description contained in the notice of public hearing, but it may
eliminate described lands from the development area in the final
determination of the boundaries.
(3) Not less than 60 days after the public hearing, if the
governing body of the municipality intends to proceed with the
establishment of the authority it shall adopt, by majority vote of
its
members, an ordinance a resolution establishing
the authority
and designating the boundaries of the development area within which
the
authority shall exercise its powers. The adoption of the
ordinance
resolution is subject to any applicable statutory or
charter provisions in respect to the approval or disapproval by the
chief executive or other officer of the municipality and the
adoption
of an ordinance a resolution over his or
her veto. This
ordinance
resolution shall be filed with the secretary of state
promptly after its adoption and shall be published at least once in
a newspaper of general circulation in the municipality.
(4) The governing body of the municipality may alter or amend
the boundaries of the development area to include or exclude lands
from
the development area in the same manner as adopting the
ordinance
resolution creating the authority.
(5) A municipality that has created an authority may enter
into an agreement with an adjoining municipality that has created
an authority to jointly operate and administer those authorities
under an interlocal agreement under the urban cooperation act of
1967, 1967 (Ex Sess) PA 7, MCL 124.501 to 124.512. The interlocal
agreement shall include, but is not limited to, a plan to
coordinate and expedite local inspections and permit approvals, a
plan to address contradictory zoning requirements, and a date
certain to implement all provisions of these plans. If a
municipality enters into an interlocal agreement under this
subsection, the municipality shall provide a copy of that
interlocal agreement to the state tax commission within 60 days of
entering into the interlocal agreement.
Sec. 9. (1) The board may employ and fix the compensation of a
director, subject to the approval of the governing body of the
municipality. The director shall serve at the pleasure of the
board. A member of the board is not eligible to hold the position
of director. Before beginning his or her duties, the director shall
take and subscribe to the constitutional oath, and furnish bond, by
posting
a bond in the sum determined in the
ordinance resolution
establishing the authority payable to the authority for use and
benefit of the authority, approved by the board, and filed with the
municipal clerk. The premium on the bond shall be considered an
operating expense of the authority, payable from funds available to
the authority for expenses of operation. The director shall be the
chief executive officer of the authority. Subject to the approval
of the board, the director shall supervise and be responsible for
the preparation of plans and the performance of the functions of
the authority in the manner authorized by this act. The director
shall attend the meetings of the board and shall provide to the
board and to the governing body of the municipality a regular
report covering the activities and financial condition of the
authority. If the director is absent or disabled, the board may
designate a qualified person as acting director to perform the
duties of the office. Before beginning his or her duties, the
acting director shall take and subscribe to the oath, and furnish
bond, as required of the director. The director shall furnish the
board with information or reports governing the operation of the
authority as the board requires.
(2) The board may employ and fix the compensation of a
treasurer, who shall keep the financial records of the authority
and who, together with the director, shall approve all vouchers for
the expenditure of funds of the authority. The treasurer shall
perform all duties delegated to him or her by the board and shall
furnish bond in an amount prescribed by the board.
(3) The board may employ and fix the compensation of a
secretary, who shall maintain custody of the official seal and of
records, books, documents, or other papers not required to be
maintained by the treasurer. The secretary shall attend meetings of
the board and keep a record of its proceedings and shall perform
other duties delegated by the board.
(4) The board may retain legal counsel to advise the board in
the proper performance of its duties. The legal counsel shall
represent the authority in actions brought by or against the
authority.
(5) The board may employ other personnel considered necessary
by the board.
Sec. 18. (1) If the authority determines that it is necessary
for the achievement of the purposes of this act, the authority
shall prepare and submit a tax increment financing plan to the
governing body of the municipality. The plan shall include a
development plan as provided in section 21, a detailed explanation
of the tax increment procedure, the maximum amount of bonded
indebtedness to be incurred, and the duration of the program, and
shall be in compliance with section 19. The plan shall contain a
statement of the estimated impact of tax increment financing on the
assessed values of all taxing jurisdictions in which the
development area is located. The plan may provide for the use of
part or all of the captured assessed value, but the portion
intended to be used by the authority shall be clearly stated in the
tax increment financing plan. The authority or municipality may
exclude from captured assessed value growth in property value
resulting solely from inflation. The plan shall set forth the
method for excluding growth in property value resulting solely from
inflation.
(2) Approval of the tax increment financing plan shall comply
with the notice, hearing, and disclosure provisions of section 22.
If the development plan is part of the tax increment financing
plan, only 1 hearing and approval procedure is required for the 2
plans together.
(3) Before the public hearing on the tax increment financing
plan, the governing body shall provide a reasonable opportunity to
the taxing jurisdictions levying taxes subject to capture to meet
with the governing body. The authority shall fully inform the
taxing jurisdictions of the fiscal and economic implications of the
proposed development area. The taxing jurisdictions may present
their recommendations at the public hearing on the tax increment
financing plan. The authority may enter into agreements with the
taxing jurisdictions and the governing body of the municipality in
which the development area is located to share a portion of the
captured assessed value of the development area.
(4) A tax increment financing plan may be modified if the
modification is approved by the governing body upon notice and
after public hearings and agreements as are required for approval
of the original plan.
(5) Not more than 60 days after the public hearing on the tax
increment financing plan, the governing body in a taxing
jurisdiction levying ad valorem property taxes that would otherwise
be subject to capture may exempt its taxes from capture by adopting
a resolution to that effect and filing a copy with the clerk of the
municipality proposing to create the authority. The resolution
shall take effect when filed with the clerk and remains effective
until a copy of a resolution rescinding that resolution is filed
with that clerk.
Sec. 20. (1) The municipality may by resolution of its
governing
body and subject to voter approval authorize,
issue,
and sell limited general obligation bonds subject to the
limitations set forth in this subsection to finance the development
program of the tax increment financing plan and shall pledge its
full faith and credit for the payment of the bonds. The
municipality may pledge as additional security for the bonds any
money received by the authority or the municipality under section
14. The bonds are subject to the revised municipal finance act,
2001 PA 34, MCL 141.2101 to 141.2821. Before the municipality may
authorize the borrowing, the authority shall submit an estimate of
the anticipated tax increment revenues and other revenue available
under section 14 to be available for payment of principal and
interest on the bonds, to the governing body of the municipality.
This estimate shall be approved by the governing body of the
municipality by resolution adopted by majority vote of the members
of the governing body in the resolution authorizing the bonds. If
the governing body of the municipality adopts the resolution
authorizing the bonds, the estimate of the anticipated tax
increment revenues and other revenue available under section 14 to
be available for payment of principal and interest on the bonds
shall be conclusive for purposes of this section. The bonds issued
under this subsection shall be considered a single series for the
purposes of the revised municipal finance act, 2001 PA 34, MCL
141.2101 to 141.2821.
(2) By resolution of its governing body, the authority may
authorize, issue, and sell tax increment bonds subject to the
limitations set forth in this subsection to finance the development
program of the tax increment financing plan. The tax increment
bonds issued by the authority under this subsection shall pledge
solely the tax increment revenues of a development area in which
the project is located or a development area from which tax
increment revenues may be used for this project, or both. In
addition or in the alternative, the bonds issued by the authority
under this subsection may be secured by any other revenues
identified in section 14 as sources of financing for activities of
the authority that the authority shall specifically pledge in the
resolution. However, the full faith and credit of the municipality
shall not be pledged to secure bonds issued under this subsection.
The bond issue may include a sum sufficient to pay interest on the
tax increment bonds until full development of tax increment
revenues from the project and also a sum to provide a reasonable
reserve for payment of principal and interest on the bonds. The
resolution authorizing the bonds shall create a lien on the tax
increment revenues and other revenues pledged by the resolution
that shall be a statutory lien and shall be a first lien subject
only to liens previously created. The resolution may provide the
terms upon which additional bonds may be issued of equal standing
and parity of lien as to the tax increment revenues and other
revenues pledged under the resolution. Bonds issued under this
subsection that pledge revenue received under section 15 for
repayment of the bonds are subject to the revised municipal finance
act, 2001 PA 34, MCL 141.2101 to 141.2821.
Sec.
22. (1) The governing body, before adoption of an
ordinance
a resolution approving a development plan or tax
increment financing plan, shall hold a public hearing on the
development plan. Notice of the time and place of the hearing shall
be given by publication twice in a newspaper of general circulation
designated by the municipality, the first of which shall be not
less than 20 days before the date set for the hearing. Notice of
the hearing shall be posted in at least 20 conspicuous and public
places in the development area not less than 20 days before the
hearing. Notice shall also be mailed to all property taxpayers of
record in the development area and to the governing body of each
taxing jurisdiction levying taxes that would be subject to capture
if the tax increment financing plan is approved not less than 20
days before the hearing. The notice of hearing within the time
frame described in this subsection shall be mailed by certified
mail to the governing body of each taxing jurisdiction levying
taxes that would be subject to capture if the tax increment
financing plan is approved.
(2) Notice of the time and place of hearing on a development
plan shall contain all of the following:
(a) A description of the proposed development area in relation
to highways, streets, streams, or otherwise.
(b) A statement that maps, plats, and a description of the
development plan, including the method of relocating families and
individuals who may be displaced from the area, are available for
public inspection at a place designated in the notice.
(c) A statement that all aspects of the development plan will
be open for discussion at the public hearing.
(d) Other information that the governing body considers
appropriate.
(3) At the time set for the hearing, the governing body shall
provide an opportunity for interested persons to speak and shall
receive and consider communications in writing. The hearing shall
provide the fullest opportunity for expression of opinion, for
argument on the merits, and for consideration of documentary
evidence pertinent to the development plan. The governing body
shall make and preserve a record of the public hearing, including
all data presented at the hearing.
Sec. 23. The governing body after a public hearing on the
development plan or the tax increment financing plan, or both, with
notice given under section 22, shall determine whether the
development plan or tax increment financing plan constitutes a
public purpose. If it determines that the development plan or tax
increment
financing plan constitutes a public purpose, it shall by
ordinance
resolution approve or reject the plan, or approve it
with modification, based on the following considerations:
(a)
The findings and recommendations of a development area
citizens
council, if a development area citizens council was
formed.
(a) (b)
The plan meets the requirements under section 20(2).
(b) (c)
The proposed method of financing the development is
feasible and the authority has the ability to arrange the
financing.
(c) (d)
The development is reasonable and necessary to carry
out the purposes of this act.
(d) (e)
The land included within the development area to be
acquired is reasonably necessary to carry out the purposes of the
plan and of this act in an efficient and economically satisfactory
manner.
(e) (f)
The development plan is in reasonable accord with
the land use plan of the municipality.
(f) (g)
Public services, such as fire and police protection
and utilities, are or will be adequate to service the project area.
(g) (h)
Changes in zoning, streets, street levels,
intersections, and utilities are reasonably necessary for the
project and for the municipality.
Sec. 27. An authority that has completed the purposes for
which
it was organized shall be dissolved by
ordinance resolution
of the governing body. The property and assets of the authority
remaining after the satisfaction of the obligations of the
authority belong to the municipality.