SENATE BILL No. 772

 

 

October 20, 2011, Introduced by Senators WALKER, PAPPAGEORGE, PAVLOV, KAHN, SCHUITMAKER, COLBECK, BOOHER, MARLEAU and PROOS and referred to the Committee on Appropriations.

 

 

 

     A bill to amend 1985 PA 227, entitled

 

"Shared credit rating act,"

 

by amending sections 7 and 8 (MCL 141.1057 and 141.1058), as

 

amended by 2005 PA 93.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 7. The board has all of the following powers:

 

     (a) To adopt bylaws for the regulation of its affairs.

 

     (b) To adopt an official seal.

 

     (c) To maintain a principal office at a place within this

 

state.

 

     (d) To sue and be sued in its own name and to plead and be

 

impleaded.

 

     (e) To loan money to a governmental unit, or to a nonprofit

 


corporation, trust, or similar entity for the benefit of a public

 

school academy, at a rate or rates as the authority determines and

 

to purchase and sell, and to commit to purchase and sell, municipal

 

obligations pursuant to this act.

 

     (f) To borrow money and issue negotiable revenue bonds and

 

notes pursuant to this act.

 

     (g) To make and enter into contracts and other instruments

 

necessary or incidental to the performance of its duties and the

 

exercise of its powers. By rotating the services of legal counsel,

 

the authority shall seek to increase the pool of nationally

 

recognized bond counsel.

 

     (h) To receive and accept from any source grants or

 

contributions of money, property, or other things of value,

 

excluding appropriations from the general fund of this state except

 

for appropriations to be used for the benefit of public schools,

 

except for appropriations to a reserve fund established under

 

section 16, except for appropriations to the state water pollution

 

control revolving fund established under section 16a and except for

 

appropriations to the state drinking water revolving fund

 

established under section 16b, and except for appropriations to the

 

school loan revolving fund established under section 16c, to be

 

used, held, and applied only for the purposes for which the grants

 

and contributions were made.

 

     (i) To do all acts necessary or convenient to carry out the

 

powers expressly granted.

 

     (j) To require that final actions of the board are entered in

 

the journal for the board and that all writings prepared, owned,

 


used, in the possession of, or retained by the board in the

 

performance of an official function be made available to the public

 

in compliance with the freedom of information act, 1976 PA 442, MCL

 

15.231 to 15.246.

 

     (k) To engage the services of private consultants on a

 

contract basis for rendering professional and technical assistance

 

and advice.

 

     (l) To investigate and assess the infrastructure needs of this

 

state, current methods of financing infrastructure rehabilitation

 

and improvements, and resources and financing options currently

 

available and potentially useful to improve this state's

 

infrastructure and lower the costs of those improvements.

 

     (m) To indemnify and procure insurance indemnifying members of

 

the board from personal loss or accountability from liability

 

asserted by a person on bonds or notes of the authority or from any

 

personal liability or accountability by reason of the issuance of

 

the bonds or notes, or by reason of any other action taken or the

 

failure to act by the authority.

 

     (n) To investigate and assess short-term and long-term

 

borrowing requirements for operating, capital improvements, and

 

delinquent taxes.

 

     (o) To provide assistance, as that term is defined in section

 

5301 of the natural resources and environmental protection act,

 

1994 PA 451, MCL 324.5301, to any municipality for a revolving fund

 

project and to perform all functions necessary or incident to

 

providing that assistance and to the operation of the state water

 

pollution control revolving fund established under section 16a.

 


     (p) To enter into agreements with the federal government to

 

implement the establishment and operation of the state water

 

pollution control revolving fund established under section 16a

 

pursuant to the provisions of the federal water pollution control

 

act and the rules and regulations promulgated under that act.

 

     (q) To provide assistance, as that term is defined in part 54

 

of the natural resources and environmental protection act, 1994 PA

 

451, MCL 324.5401 to 324.5418, to any governmental unit for a

 

revolving fund community water supply or noncommunity water supply

 

and to perform all functions necessary or incident to providing

 

that assistance and to the operation of the state drinking water

 

revolving fund established under section 16b, including, but not

 

limited to, using funding allocated in the federal safe drinking

 

water act for any of the purposes authorized in section 5417(c) of

 

the natural resources and environmental protection act, 1994 PA

 

451, MCL 324.5417.

 

     (r) To enter into agreements with the federal government to

 

establish and operate the state drinking water revolving fund under

 

section 16b pursuant to the provisions of the federal safe drinking

 

water act and the rules and regulations promulgated under that act.

 

     (s) To enter into agreements with the state treasurer to act

 

as this state's agent to implement the establishment and operation

 

of the school loan revolving fund established under section 16c,

 

including provisions relating to the return to this state of

 

contributions made by this state for deposit in the school loan

 

revolving fund that are no longer needed for school loan revolving

 

fund purposes and the assignment to this state of loans and loan

 


repayments made from or payable to the school loan revolving fund.

 

     Sec. 8. (1) The authority may lend money to a governmental

 

unit through the purchase by the authority of municipal obligations

 

of the governmental unit in fully marketable form. The authority

 

may authorize and issue its bonds or notes payable solely from the

 

revenues or funds available to the authority, and to otherwise

 

assist governmental units.

 

     (2) Bonds and notes of the authority shall not be in any way a

 

debt or liability of this state and shall not create or constitute

 

any indebtedness, liability, or obligations of this state or be or

 

constitute a pledge of the faith and credit of this state but all

 

authority bonds and notes, unless funded or refunded by bonds or

 

notes of the authority, shall be payable solely from revenues or

 

funds pledged or available for their payment as authorized in this

 

act. Each bond and note shall contain on its face a statement to

 

the effect that the authority is obligated to pay the principal of

 

and the interest on the bond or note only from revenues or funds of

 

the authority and that this state is not obligated to pay the

 

principal or interest and that neither the faith and credit nor the

 

taxing power of this state is pledged to the payment of the

 

principal of or the interest on the bond or note.

 

     (3) All expenses incurred in carrying out this act shall be

 

payable solely from revenues or funds provided or to be provided

 

under the provisions of this act, and nothing in this act shall be

 

construed to authorize the authority to incur any indebtedness or

 

liability on behalf of or payable by this state.

 

     (4) Unless approved by a concurrent resolution of the

 


legislature and except as permitted by section 16a, 16b, or 16c,

 

the authority shall not provide preferential treatment in the rate

 

of interest for a particular municipal obligation purchased by the

 

authority that is based upon other than financial and credit

 

considerations and shall not forgive or relinquish all or part of

 

the interest or principal of a particular municipal obligation or

 

of municipal obligations of a particular purpose.

 

     (5) The authority may purchase bonds issued by school

 

districts that are qualified bonds under a school loan act. Except

 

as provided in subsection (6), the principal amount of the

 

qualified bonds purchased by the authority in any calendar year

 

shall not exceed 7.5% of the principal amount of qualified bonds

 

issued by school districts in the immediately preceding calendar

 

year. The authority may also purchase or accept by assignment from

 

this state municipal obligations that are loan repayment

 

obligations from a school district on a qualified loan made by this

 

state under a school loan act. Municipal obligations acquired by

 

the authority under this subsection are not required to be in fully

 

marketable form.

 

     (6) In addition to qualified bonds purchased under subsection

 

(5), the authority may purchase qualified bonds issued by school

 

districts not later than September 30, 2004 to obtain funds to

 

repay all or a portion of the outstanding balance of a loan under

 

former 1961 PA 108, MCL 388.951 to 388.963, on the terms and

 

conditions and subject to the requirements provided by or pursuant

 

to a resolution of the authority. Bonds issued by the authority to

 

purchase school district qualified bonds under this subsection

 


shall be issued in an amount sufficient to provide and pay the

 

reasonable costs of issuance incurred by the school districts as

 

determined by or pursuant to a resolution of the authority.