HB-5460, As Passed Senate, June 11, 2014

SENATE SUBSTITUTE FOR

HOUSE BILL NO. 5460

     A bill to amend 1951 PA 51, entitled

"An act to provide for the classification of all public roads,

streets, and highways in this state, and for the revision of that

classification and for additions to and deletions from each

classification; to set up and establish the Michigan transportation

fund; to provide for the deposits in the Michigan transportation

fund of specific taxes on motor vehicles and motor vehicle fuels;

to provide for the allocation of funds from the Michigan

transportation fund and the use and administration of the fund for

transportation purposes; to promote safe and efficient travel for

motor vehicle drivers, bicyclists, pedestrians, and other legal

users of roads, streets, and highways; to set up and establish the

truck safety fund; to provide for the allocation of funds from the

truck safety fund and administration of the fund for truck safety

purposes; to set up and establish the Michigan truck safety

commission; to establish certain standards for road contracts for

certain businesses; to provide for the continuing review of

transportation needs within the state; to authorize the state

transportation commission, counties, cities, and villages to borrow

money, issue bonds, and make pledges of funds for transportation

purposes; to authorize counties to advance funds for the payment of

deficiencies necessary for the payment of bonds issued under this

act; to provide for the limitations, payment, retirement, and

security of the bonds and pledges; to provide for appropriations

and tax levies by counties and townships for county roads; to

authorize contributions by townships for county roads; to provide

for the establishment and administration of the state trunk line

fund, local bridge fund, comprehensive transportation fund, and

certain other funds; to provide for the deposits in the state trunk

line fund, critical bridge fund, comprehensive transportation fund,

and certain other funds of money raised by specific taxes and fees;

to provide for definitions of public transportation functions and

criteria; to define the purposes for which Michigan transportation

funds may be allocated; to provide for Michigan transportation fund

grants; to provide for review and approval of transportation

programs; to provide for submission of annual legislative requests

and reports; to provide for the establishment and functions of

certain advisory entities; to provide for conditions for grants; to

provide for the issuance of bonds and notes for transportation

purposes; to provide for the powers and duties of certain state and

local agencies and officials; to provide for the making of loans

for transportation purposes by the state transportation department

and for the receipt and repayment by local units and agencies of

those loans from certain specified sources; and to repeal acts and

parts of acts,"

by amending sections 11, 12, 13, and 14 (MCL 247.661, 247.662,

247.663, and 247.664), section 11 as amended by 2002 PA 639,

sections 12 and 13 as amended by 2012 PA 298, and section 14 as

amended by 1987 PA 234.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 11. (1) A fund to be known as the state trunk line fund

is established and shall be set up and maintained in the state

treasury as a separate fund. The money deposited in the state trunk

line fund is appropriated to the state transportation department

for the following purposes in the following order of priority:

     (a) For the payment, but only from money restricted as to use

by section 9 of article IX of the state constitution of 1963, of

bonds, notes, or other obligations in the following order of

priority:

     (i) For the payment of contributions pledged before July 18,

1979 and required to be made by the state highway commission or the

state transportation commission under contracts entered into before

July 18, 1979, under 1941 PA 205, MCL 252.51 to 252.64, which

contributions have been pledged before July 18, 1979, for the

payment of the principal and interest on bonds issued under 1941 PA

205, MCL 252.51 to 252.64, for the payment of which a sufficient

sum is irrevocably appropriated.

     (ii) For the payment of the principal and interest upon bonds

designated "State of Michigan, State Highway Commissioner, Highway

Construction Bonds, Series I", dated September 1, 1956, in the

aggregate principal amount of $25,000,000.00, issued pursuant to

former 1955 PA 87 and the resolution of the state administrative

board adopted August 6, 1956, for the payment of which a sufficient

sum is irrevocably appropriated.

     (iii) For the payment of the principal and interest on bonds

issued under section 18b for transportation purposes other than

comprehensive transportation purposes as defined by law and the

payment of contributions of pledged to the payment of principal and

interest on bonds issued under section 18d and contracts entered

into under section 18d by the state highway commission or state

transportation commission to be made pursuant to contracts entered

into under section 18d. , which contributions are pledged to the

payment of principal and interest on bonds issued under the

authorization of section 18d and contracts executed pursuant to

that section. A sufficient portion of the fund is irrevocably

appropriated to pay, when due, the principal and interest on bonds

or notes issued under section 18b for purposes other than

comprehensive transportation purposes as defined by law, and to pay

the annual contributions of the state highway commission and the

state transportation commission as are pledged for the payment of

bonds issued pursuant to under contracts authorized by section 18d.

     (b) For the transfer of funds money appropriated pursuant to

under section 10(1)(g) 10(1)(h) to the transportation economic

development fund, but the transfer shall be reduced each fiscal

year by the amount of debt service to be paid in that year from the

state trunk line fund for bonds, notes, or other obligations issued

to fund projects of the transportation economic development fund,

which amount shall be certified by the department.

     (c) For the transfer of funds money appropriated pursuant to

under section 10(1)(a) to the railroad rail grade crossing account

in the state trunk line fund for expenditure for rail grade

crossing improvement purposes at rail grade crossings on public

roads and streets under the jurisdiction of the this state,

counties, cities, or villages. Projects The department shall be

selected select projects for funding in accordance with the

following:

     (i) Not more than 50% or less than 30% of these funds this

money and matched federal funds money shall be expended for state

trunk line projects.

     (ii) In prioritizing projects for these funds, this money, in

whole or in part, the department shall consider train and vehicular

traffic volumes, accident history, traffic control device

improvement needs, and the availability of funding.

     (iii) Consistent with the other requirements for these funds,

this money, the first priority for funds money deposited pursuant

to under this subdivision for rail grade crossing improvements and

retirement shall be to match federal funds money from the railroad-

highway grade crossing improvement program or other comparable

federal programs if a match is required under federal law.

     (iv) If the department and the a road authority with

jurisdiction over the crossing formally agree that the grade

crossing should be eliminated by permanent closing of the public

road or street, the physical removal of the crossing, roadway

within railroad rights of way and street termination treatment will

shall be negotiated between the road authority and railroad

company. The funds money provided to the road authority as a result

of the crossing closure will shall be credited to its account

representing the same road or street system on which the crossing

is located and shall be used for any transportation purpose within

that road authority's jurisdiction.

     (d) For the total operating expenses of the state trunk line

fund for each fiscal year as appropriated by the legislature.

     (e) For the preservation of state trunk line highways and

bridges.

     (f) For the opening, widening, improving, construction, and

reconstruction of state trunk line highways and bridges, including

the acquisition of necessary rights of way and the work incidental

to that opening, widening, improving, construction, or

reconstruction. Those sums in the state trunk line fund not

otherwise appropriated, distributed, determined, or set aside by

law shall be used for the construction or reconstruction of the

national system of interstate and defense highways, referred to in

this act as "the interstate highway system" to the extent necessary

to match federal aid funds money as the federal aid funds become

money becomes available for that purpose; and, for the construction

and reconstruction of the state trunk line system.

     (g) The state transportation department may enter into

agreements with county road commissions and with cities and

villages a local road agency or a private sector company to perform

work on a highway, road, or street. The agreements may provide for

the performance by any of the contracting parties of any of the

work contemplated by the contract including maintenance,

engineering services, and the acquisition of rights of way in

connection with the work, by purchase or condemnation by any of the

contracting parties in its own name, and for joint participation in

the costs, but only to the extent that the contracting parties are

otherwise authorized by law to expend money on the highways, roads,

or streets. The state transportation department also may contract

with a county local road commission, city, and village agency to

advance money to a county local road commission, city, and village

agency to pay their the costs of improving railroad grade crossings

on the terms and conditions agreed to in the contract. A contract

may be executed before or after the state transportation commission

borrows money for the purpose of advancing money to a county local

road commission, city, or village, agency, but the contract shall

be executed before the advancement of any money to a county local

road commission, city, or village agency by the state

transportation commission, and shall provide for the full

reimbursement of any advancement by a county local road commission,

city, or village agency to the state transportation department,

with interest, within 15 years after advancement, from any

available revenue sources of the county local road commission,

city, or village agency or, if provided in the contract, by

deduction from the periodic disbursements of any money returned by

the state to the county local road commission, city, or

village.agency.

     (h) For providing inventories of supplies and materials

required for the activities of the state transportation department.

The state transportation department may purchase supplies and

materials for these purposes, with payment to be made out of the

state trunk line fund to be charged on the basis of issues from

inventory in accordance with the accounting and purchasing laws of

this state.

     (2) Notwithstanding any other provision of this act, the

department shall annually expend at least 90% of state revenue

appropriated annually to the state trunk line fund less the amounts

described in subdivisions (a) to (i) shall be expended annually by

the state transportation department for the preservation of

highways, roads, streets, and bridges and for the payment of debt

service on bonds, notes, or other obligations described in

subsection (1)(a) issued after July 1, 1983, for the purpose of

providing funds money for the preservation of highways, roads,

streets, and bridges. Of the amounts appropriated for state trunk

line projects, the department shall, where possible, secure

pavement warranties of not less than 5-year for full replacement or

appropriate repair guarantee for contracted construction work on

pavement projects whose cost exceeds $1,000,000.00 and projects for

new construction or reconstruction undertaken after the effective

date of the 2014 amendatory act that amended this subdivision. The

department shall compile and make available to the public an annual

report of all warranties that were secured under this subsection

and all projects where a warranty was not secured as provided in

subsection (14). If an appropriate certificate is filed under

section 18e but only to the extent necessary, this subsection shall

does not prohibit the use of any amount of money restricted as to

use by section 9 of article IX of the state constitution of 1963

and deposited in the state trunk line fund for the payment of debt

service on bonds, notes, or other obligations pledging for the

payment thereof money restricted as to use by section 9 of article

IX of the state constitution of 1963 and deposited in the state

trunk line fund, whenever issued, as specified under subsection

(1)(a). The amounts which that are deducted from the state trunk

line fund for the purpose of the calculation required by this

subsection are as follows:

     (a) Amounts expended for the purposes described in subsection

(1)(a) for the payment of debt service on bonds, notes, or other

obligations issued before July 2, 1983.

     (b) Amounts expended to provide the state matching requirement

for projects on the national highway system and for the payment of

debt service on bonds, notes, or other obligations issued after

July 1, 1983, for the purpose of providing funds money for the

state matching requirements for projects on the national highway

system.

     (c) Amounts expended for the construction of a highway,

street, road, or bridge to 1 or more of the following or for the

payment of debt service on bonds, notes, or other obligations

issued after July 1, 1983, for the purpose of providing funds money

for the construction of a highway, street, road, or bridge to 1 or

more of the following:

     (i) A location for which a building permit has been obtained

for the construction of a manufacturing or industrial facility.

     (ii) A location for which a building permit has been obtained

for the renovation of, or addition to, a manufacturing or

industrial facility.

     (d) Amounts expended for capital outlay other than for

highways, roads, streets, and bridges or to pay debt service on

bonds, notes, or other obligations issued after July 1, 1983, for

the purpose of providing funds money for capital outlay other than

for highways, roads, streets, and bridges.

     (e) Amounts expended for the operating expenses of the state

transportation department other than the units of the department

performing the functions assigned on January 1, 1983 to the bureau

of highways.

     (f) Amounts expended pursuant to contracts entered into before

January 1, 1983.

     (g) Amounts expended for the purposes described in subsection

(5).

     (h) Amounts appropriated for deposit in the transportation

economic development fund and the rail grade crossing account

pursuant to section 10(1)(g) and 10(1)(a) and (h).

     (i) Upon the affirmative recommendation of the director of the

state transportation department and the approval by resolution of

the state transportation commission, those amounts expended for

projects vital to the economy of this state, a region, or local

area or the safety of the public. The resolution shall state the

cost of the project exempted from this subsection.

     (3) Notwithstanding any other provision of this act, the state

transportation department shall expend annually at least 90% of the

federal revenue distributed to the credit of the state trunk line

fund in that year, except for federal revenue expended for the

purposes described in subsection (2)(b), (c), (f), and (i) and for

the payment of notes issued under section 18b(9) on the

preservation of highways, roads, streets, and bridges. The

requirement of this subsection shall be is waived if compliance

would cause this state to be ineligible according to federal law

for federal revenue, but only to the extent necessary to make this

state eligible according to federal law for that revenue.

     (4) Notwithstanding any other provision of this section, the

state transportation department may loan money to county a local

road commissions, cities, and villages agency for paying capital

costs of transportation purposes described in the second paragraph

of section 9 of article IX of the state constitution of 1963 from

the proceeds of bonds or notes issued pursuant to section 18b or

from the state trunk line fund. Loans made directly from the state

trunk line fund shall be made only after provision of funds money

for the purposes specified in subsection (1)(a) to (f). Loans

described in this subsection are not subject to the revised

municipal finance act, 2001 PA 34, MCL 141.2101 to 141.2821.

     (5) County A local road commissions, cities, and villages

agency may borrow money from the proceeds of bonds or notes issued

under section 18b or the state trunk line fund for the purposes set

forth in subsection (4) that shall be repayable, with interest,

from 1 or more of the following:

     (a) The money to be received by the county local road

commission, city, or village agency from the Michigan

transportation fund, except to the extent the money has been or may

in the future be pledged by contract in accordance with 1941 PA

205, MCL 252.51 to 252.64, or has been or may in the future be

pledged for the payment of the principal and interest upon notes

issued pursuant to under 1943 PA 143, MCL 141.251 to 141.254, or

has been or may in the future be pledged for the payment of

principal and interest upon bonds issued under section 18c or 18d,

or has been or may in the future be pledged for the payment of the

principal and interest upon bonds issued pursuant to under 1952 PA

175, MCL 247.701 to 247.707.

     (b) Any other legally available funds money of the city,

village, or county local road commission, agency, other than the

general funds of the county.

     (6) Loans If required by the department, loans made pursuant

to under subsection (4) if required by the state transportation

department may be are payable by deduction by the state treasurer,

upon direction of the state transportation department, from the

periodic disbursements of any money returned by the this state

under this act to the county local road commission, city, or

village, agency, but only after sufficient money has been returned

to the county local road commission, city, or village agency to

provide for the payment of contractual obligations incurred or to

be incurred and principal and interest on notes and bonds issued or

to be issued under 1941 PA 205, MCL 252.51 to 252.64, 1943 PA 143,

MCL 141.251 to 141.254, 1952 PA 175, MCL 247.701 to 247.707, or

section 18c or 18d. The interest rates and payment schedules of any

loans made from the proceeds of bonds or notes issued pursuant to

section 18b shall be established by the state transportation

department to conform as closely as practicable to the interest

rate and repayment schedules on the bonds or notes issued to make

the loans. However, the state transportation department may allow

for the deferral of the first payment of interest or principal on

the loans for a period of not to exceed 1 year after the respective

first payment of interest or principal on the bonds or notes issued

to make the loans.

     (7) The amount borrowed by a county local road commission,

city, or village pursuant to agency under subsection (5) shall not

be included in, or charged against, any constitutional, statutory,

or charter debt limitation of the county, city, or village and

shall not be included in the determination of the maximum annual

principal and interest requirements of, or the limitations upon,

the maximum annual principal and interest incurred under 1941 PA

205, MCL 252.51 to 252.64, 1943 PA 143, MCL 141.251 to 141.254,

1952 PA 175, MCL 247.701 to 247.707, or section 18c or 18d.

     (8) The county local road commission, city, or village agency

is not required to seek or obtain the approval of the electors, the

municipal finance commission or its successor agency, or, except as

provided in this subsection, the department of treasury to borrow

money pursuant to under subsection (5). The borrowing is not

subject to the revised municipal finance act, 2001 PA 34, MCL

141.2101 to 141.2821, or to section 5(g) of the home rule city act,

1909 PA 279, MCL 117.5. The state transportation department shall

give at least 10 days' notice to the state treasurer of its

intention to make a loan under subsection (4). If the state

treasurer gives notice to the director of the state transportation

department within 10 days of receiving the notice from the state

transportation department, that, based upon the then existing

financial or credit situation of the county local road commission,

city, or village, agency, it would not be in the best interests of

the this state to make a loan under subsection (4) to the county

local road commission, city, or village, agency, the loan shall not

be made unless the state treasurer, after a hearing, if requested

by the affected county local road commission, city, or village,

agency, subsequently gives notice to the director of the state

transportation department that the loan may be made on the

conditions that the state treasurer specifies.

     (9) The state transportation commission may borrow money and

issue bonds and notes under , and pursuant to the requirements of,

section 18b to make loans to county a local road commissions,

cities, and villages agency for the purposes described in the

second paragraph of section 9 of article IX of the state

constitution of 1963, as provided in subsection (4). A single issue

of bonds or notes may be issued for the purposes specified in

subsection (4) and for the other purposes specified in section 18b.

The house and senate transportation appropriations subcommittees

shall be notified by the department if there are extras and

overruns sufficient to require approval of either the state

administrative board or the commission, or both, on any contract

between the department and a local road agency or a private

business.

     (10) The director of the state transportation department,

after consultation with representatives of the interests of county

local road commissions, cities, and villages, agencies, shall

establish, by intergovernmental communication, procedures for the

implementation and administration of the loan program established

under subsections (4) to (9).

     (11) Not more than 10% per year of all of the funds money

received by and returned to the state transportation department

from any source for the purposes of this section may be expended

for administrative expenses. The department shall be subject to

section 14(5) if more than 10% per year is expended for

administrative expenses. As used in this subsection,

"administrative expenses" means those expenses that are not

assigned including, but not limited to, specific road construction

or preservation projects and are often referred to as general or

supportive services. Administrative expenses shall do not include

net equipment expense, net capital outlay, debt service principal

and interest, and payments to other state or local offices which

that are assigned, but not limited to, specific road construction

projects or preservation activities.

     (12) Any performance audits of the department shall be

conducted according to government auditing standards issued by the

United States general accounting office.

     (13) Contracts entered into to advance money to a county local

road commission, city, or village agency under subsection (1)(g)

are not subject to the revised municipal finance act, 2001 PA 34,

MCL 141.2101 to 141.2821.

     (14) The department shall prepare on an annual basis a report

listing all warranties that were secured under subsection (2) and

indicate whether any of those warranties were redeemed. The

department shall make the report required by this subsection

available to the public upon request and shall also post the report

on its website, which shall include, but is not limited to, all of

the following information:

     (a) The type of project.

     (b) The cost or estimated cost of the project.

     (c) The expected lifespan of the project.

(15) (14) As used in this section: , "rail grade crossing

improvement purposes"

     (a) "Local road agency" means that term as defined in section

9a.

     (b) "Rail grade crossing improvement purposes" means 1 or more

of the following:

(i) (a) The installation and modernization of active and

passive warning devices at railroad grade crossings.

(ii) (b) The installation or improvement of grade crossing

surfaces.

(iii) (c) Modification, relocation, or modernization of railroad

grade crossing active and passive warning devices necessitated by

roadway improvement projects.

(iv) (d) Test installations of innovative warning devices or

other innovative applications.

(v) (e) Construction of new grade separations.

(vi) (f) A cash incentive payment made pursuant to subsection

(1)(c)(iv) for any public road or street crossing, in an amount no

greater than the cost of installing flashing light signals and half

roadway gates at the crossing.

(vii) (g) Any other work that would be eligible for funding

under the federal railroad-highway grade crossing improvement

program or other comparable programs.

     Sec. 12. (1) The amount distributed to the county road

commissions shall be returned to the county treasurers in the

manner, for the purposes, and under the terms and conditions

specified in this section. The department and the county road

association of Michigan shall jointly develop incentives for

counties to establish statewide purchasing pools for the more

efficient use of Michigan transportation funds.

     (2) Each county road commission shall be reimbursed in an

amount up to $10,000.00 per year for the sum paid to a licensed

professional engineer employed or retained by the county road

commission in the previous year. The sum shall be returned to each

county road commission certified by the department as complying

with this subsection regarding the employment of an engineer.

     (3) An amount equal to 1% of the total amount returned to the

county road commissions from the Michigan transportation fund

during the prior calendar year shall be withheld annually from the

counties' November monthly distribution provided for in section 17,

and the amount shall be returned to the county road commissions for

snow removal purposes as provided in section 12a.

     (4) An amount equal to 10% of the total amount returned to the

county road commissions from the Michigan transportation fund shall

be returned to each county road commission having county primary,

or county local road, or both, mileage in the urban areas as

determined pursuant to section 12b. This sum shall be distributed

pursuant to section 12b. The return shall be in addition to the

amounts provided in subsections (6) and (7) and for the purposes

stated in those subsections.

     (5) An amount equal to 4% of the total amount returned to the

county road commissions from the Michigan transportation fund shall

be returned to the county road commissions in the same percentages

as provided in subsection (7). All money returned to the county

road commissions as provided in this subsection shall be expended

by the county road commissions for the preservation, construction,

acquisition, and extension of county local road systems and shall

be in addition to the amounts provided in subsection (7).

     (6) Seventy-five percent of the remainder of the total amount

to be returned to the counties shall be expended by each county

road commission for the preservation, construction, acquisition,

and extension of the county primary road system, including the

acquisition of a necessary right of way for the system, work

incidental to the system, and a roadside park or motor parkway

appurtenant to the system, and shall be returned to the counties as

follows:

     (a) Three-fourths of the amount in proportion to the amount

received within the respective county during the 12 months next

preceding the date of each monthly distribution, as specific taxes

upon registered motor vehicles under the Michigan vehicle code,

1949 PA 300, MCL 257.1 to 257.923.

     (b) One-tenth of the amount in the same proportion that the

total mileage in the county primary road system of each county

bears to the total mileage in all of the county primary road

systems of the this state.

     (c) One eighty-third of the remaining 15% of the amount to

each county.

     (7) The balance of the remainder of the total amount to be

returned to counties shall be expended by each county road

commission for the preservation, construction, acquisition, and

extension of the county local road system as defined by this act,

including the acquisition of a necessary right of way for the

system, work incidental to the system, and a roadside park or motor

parkway appurtenant to the system, and shall be returned to the

counties as follows:

     (a) Sixty-five percent of the amount in the same proportion

that the total mileage in the county local road system of each

county bears to the total mileage in all of the county local road

systems of the state.

     (b) Thirty-five percent of the amount in the same proportion

that the total population outside of incorporated municipalities in

each county bears to the total population outside of incorporated

municipalities in all of the counties of the state, according to

the most recent statewide federal census as certified at the

beginning of the state fiscal year.

     (8) Money deposited in, or becoming a part of the county road

funds of a board of county road commissioners shall be expended

first for the payment of principal and interest on the bonds, for

the payment of contractual contributions pledged for the payment of

bonds, for debt service requirements for the payment of contractual

contributions pledged for the payment of bonds, and for debt

service requirements for the payment of notes and loans in the

following order of priority:

     (a) For the payment of contributions required to be made by a

board of county road commissioners under a contract entered into

under 1941 PA 205, MCL 252.51 to 252.64, that have been pledged for

the payment of the principal and interest on bonds issued under

that act, or for the payment of total debt service requirements

upon notes issued by a board of county road commissioners under

1943 PA 143, MCL 141.251 to 141.254.

     (b) For the payment of principal and interest upon bonds

issued under section 18c, and the payment of contributions of a

board of county road commissioners made pursuant to contracts

entered into under section 18d that are pledged to the payment of

principal and interest on bonds issued after June 30, 1957, under

the authorization of section 18c and contracts executed pursuant to

its provisions.section 18c.

     (c) For the payment of principal and interest upon loans

received pursuant to section 11(5), to the extent other funds have

not been made available for that payment.

     (9) Beginning November 1, 2008, no more than 50% per year of

the amount returned to a county for use on the county primary road

system may be expended, with or without matching, on the county

local road system of that county. Except as otherwise provided in

this subsection, beginning September 30, 2010, no more than 30% per

year of the amount returned to a county for use on the county

primary road system may be expended, with or without matching, on

the county local road system of that county. An additional amount,

not to exceed 20% per year of the amount returned to a county for

use on the county primary road system, may be expended on the

county local road system of that county if there is an emergency or

if the county road commission determines that an additional 20% may

be expended on the county local road system. The county road

commission may attach any conditions to its determination if the

determination is for nonemergency purposes, including, but not

limited to, a requirement that the additional 20% expended on the

county local road system only be used to supplement funds money

from other sources. No more than 15% per year of the amount

returned to a county for expenditure on the county local road

system may be used, with or without matching, on the county primary

road system of that county, and not to exceed an additional 15% per

year of the amount returned to a county for expenditure on the

county local road system, may, in case of an emergency or with the

approval of the county road commission, be expended, with or

without matching, on the county primary road system of that county.

An amount returned to a county for and on account of county local

roads , under this section , that is in excess of the total amount

paid into the county treasury each year by all of the townships of

that county for and on account of the county local roads pursuant

to section 14(6) may be transferred to and expended on the county

primary road system of that county.

     (10) Not less than 20% per year of the funds money returned to

a county by this section shall be expended for snow and ice

removal, the construction or reconstruction of a new highway or

existing highway, and the acquisition of a necessary right of way

for those highways, and work incidental to those highways, or for

the servicing of bonds issued by the county for these purposes.

Surplus funds A county may be expended expend surplus money for the

development, construction, or repair of an off-street parking

facility.

     (11) Not more than 5% per year of the funds money returned to

a county for the county primary road system and the county local

road system shall be expended for the maintenance, improvement, or

acquisition of appurtenant roadside parks and motor parkways.

     (12) Funds Money returned to a county shall be expended by the

county road commission for the purposes provided in this section

and shall be deposited by the county treasurer in a designated

county depository, in a separate account to the credit of the

county road fund, and shall be paid out only upon the order of the

county road commission, and interest accruing on the money shall

become a part of, and be deposited with the county road fund.

     (13) In a county to which funds are money is returned under

this section, the function of the county road commission shall be

is limited to the formation of policy and the performance of the

official duties imposed by law and delegated by the county board of

commissioners. A member of the county road commission shall not be

employed individually in any other capacity for other duties with

the county road commission.

     (14) A county road commission may enter into an agreement with

a county road commission of an adjacent county and with a city or

village to perform work on a highway, road, or street, and with the

department with respect to a state trunk line highway and

connecting links of the state trunk line highway within the limits

of the county or adjacent to the county. The agreement may provide

for the performance by each contracting party of the work

contemplated by the contract including engineering services and the

acquisition of rights of way in connection with the work

contemplated, by purchase or condemnation, by any of the

contracting parties in its own name and the agreement may provide

for joint participation in the costs.

     (15) Money distributed from the Michigan transportation fund

may be expended for construction purposes on county local roads

only to the extent matched by money from other sources. However,

Michigan transportation funds may be expended for the construction

of bridges on the county local roads in an amount not to exceed 75%

of the cost of the construction of local road bridges.

     (16) Notwithstanding any other provision of this act, at least

90% of the state revenue returned annually to the county road

commission from the Michigan transportation fund less the amounts

described in subdivisions (a) to (e) shall be expended annually by

the county road commission for the preservation of highways, roads,

streets, and bridges, and for the payment of contractual

contributions pledged for the payment of bonds or portions of

bonds, debt service requirements for the payment of bonds or

portions of bonds, and debt service requirements for the payment of

notes and loans or portions of notes and loans issued or received

after July 1, 1983, for the purpose of providing funds money for

the preservation of highways, roads, streets, and bridges. If an

appropriate certificate is filed under subsection (18) but only to

the extent necessary, this subsection does not prohibit the use of

any amount of state revenue returned annually to the county road

commissions for the payment of contractual contributions pledged

for the payment of bonds, for debt service requirements for the

payment of bonds, and for debt service requirements for the payment

of notes or loans, whenever issued or received, as specified under

subsection (8). The amounts that are deducted from the state

revenue returned to a county road commission from the Michigan

transportation fund, for the purpose of the calculation required by

this subsection are as follows:

     (a) Amounts expended for the purposes described in subsection

(8) for bonds, notes, loans, or other obligations issued or

received before July 2, 1983.

     (b) Amounts expended for the administrative costs of the

county road commission.

     (c) Amounts expended for capital outlay projects for equipment

and buildings, and for the payment of contractual contributions

pledged for the payment of bonds, for debt service requirements for

the payment of bonds, and for debt service requirements for the

payment of notes and loans issued or received after July 1, 1983,

for the purpose of providing funds for capital outlay projects for

equipment and buildings.

     (d) Amounts expended for projects vital to the economy of the

local area or the safety of the public in the local area. Before

these amounts can be deducted, the governing body over the county

road commission or the county road commission, as applicable, shall

pass a resolution approving these projects. This resolution shall

state which projects will be funded and the cost of each project. A

copy of each approved resolution shall be forwarded immediately to

the department.

     (e) Amounts expended in urban areas as determined pursuant to

section 12b.

     (17) As used in this subsection, "urban routes" means those

portions of 2-lane county primary roads within an urban area that

have average daily traffic in excess of 15,000. Notwithstanding any

other provision of this act, except as provided in this subsection,

a county road commission shall annually expend at least 90% of the

federal revenue distributed to the county road commission for

highways, roads, streets, and bridges, less the amount expended on

urban routes for purposes other than preservation and the amount

expended for hard-surfacing of gravel roads on the federal-aid

system, on the preservation of highways, roads, streets, and

bridges. A county road commission may expend in 1 year less than

90% of the federal revenue distributed to the county road

commission for highways, roads, streets, and bridges, less the

amount expended on urban routes for purposes other than

preservation and the amount expended for hard-surfacing of gravel

roads on the federal-aid system, on the preservation of highways,

roads, streets, and bridges, if that year is part of a 3-year

period in which at least 90% of the total federal revenue

distributed in the 3-year period to the county road commission for

highways, roads, streets, and bridges, less the amount expended on

urban routes for purposes other than preservation purposes and the

amount expended for hard-surfacing of gravel roads on the federal-

aid system, is expended on the preservation of highways, roads,

streets, and bridges. If a county road commission expends in 1 year

less than 90% of the federal revenue distributed to the county road

commission for highways, roads, streets, and bridges, less the

amount expended on urban routes for purposes other than

preservation and the amount expended for hard-surfacing of gravel

roads on the federal-aid system, on the preservation of highways,

roads, streets, and bridges and that year is not a part of a 3-year

period in which at least 90% of the total federal revenue

distributed in the 3-year period to the county road commission for

highways, roads, streets, and bridges, less the amount expended on

urban routes for purposes other than preservation and the amount

expended for hard-surfacing of gravel roads on the federal-aid

system, is expended on the preservation of highways, roads,

streets, and bridges, the county road commission shall expend in

each year subsequent to the 3-year period 100%, or less in 1 year

if sufficient for the purposes of this subsection, of the federal

revenue distributed to the county road commission for highways,

roads, streets, and bridges, less the amount expended on urban

routes for purposes other than preservation and the amount expended

for hard-surfacing of gravel roads on the federal-aid system, on

the preservation of highways, roads, streets, and bridges until the

average percentage spent on the preservation of highways, roads,

streets, and bridges in the 3-year period and the subsequent years,

less the amount expended on urban routes for purposes other than

preservation and the amount expended for hard-surfacing of gravel

roads on the federal-aid system, is at least 90%. A year may be

included in only one 3-year period for the purposes of this

subsection. The requirements of this subsection shall be waived if

compliance would cause the county road commission to be ineligible

for federal revenue under federal law, but only to the extent

necessary to make the county road commission eligible for that

revenue under federal law. For the purpose of the calculations

required by this subsection, the amount expended on urban routes by

a county road commission for purposes other than preservation and

the amount expended for hard-surfacing of gravel roads on the

federal-aid system shall be deducted from the total federal revenue

distributed to the use of the county road commission.

     (18) A county road commission shall certify to the department

on or before the issuance of any bonds or notes issued after July

1, 1983, pursuant to 1943 PA 143, MCL 141.251 to 141.254, 1941 PA

205, MCL 252.51 to 252.64, or section 18c or 18d, for purposes

other than the preservation of highways, roads, streets, and

bridges and purposes other than the purposes specified in

subsection (16)(c) that its average annual debt service

requirements for all bonds and notes or portions of bonds and notes

issued after July 1, 1983, for purposes other than the preservation

of highways, roads, streets, and bridges and other than for the

purposes specified in subsection (16)(c), including the bond or

note to be issued does not exceed 10% of the funds money returned

to the county road commission pursuant to this act, less the

amounts specified in subsection (16)(a), (b), and (c) during the

last completed fiscal year of the county road commission. If the

purpose for which the bonds or notes are issued is changed after

the issuance of the notes or bonds, the change shall be made in a

manner that maintains compliance with the certification required by

this subsection, as of the date the certificate was originally

issued, but no such change shall invalidate or otherwise affect the

bonds or notes with respect to which the certificate was issued or

the obligation to pay debt service on the bonds or notes. A

certification under this subsection is conclusive as to the matters

stated in the certification for purposes of the validity of bonds

and notes.

     (19) In each charter county to which funds are returned under

this section, the responsibility for road improvement,

preservation, and traffic operation work, and the development,

construction, or repair of off-road parking facilities and

construction or repair of road lighting shall be coordinated by a

single administrator to be designated by the county executive who

shall be responsible for and shall represent the charter county in

transactions with the department pursuant to this act.

     (20) Not more than 10% per year of all of the funds money

received by and returned to a county from any source for the

purposes of this section may be expended for administrative

expenses. A county that expends more than 10% for administrative

expenses in a year is subject to section 14(5) unless a waiver is

granted by the department of treasury. As used in this subsection,

"administrative expenses" means those expenses that are not

assigned including, but not limited to, specific road construction

or preservation projects and are often referred to as general or

supportive services. Administrative expenses do not include net

equipment expense, net capital outlay, debt service principal and

interest, and payments to other state or local offices that are

assigned, but not limited to, specific road construction projects

or preservation activities.

     (21) In addition to the financial compliance audits required

by law, the department may conduct performance audits and make

investigations of the disposition of all state funds money received

by county road commissions, county boards of commissioners, or any

other county governmental agency acting as the county road

authority, for transportation purposes to determine compliance with

the terms and conditions of this act. Performance audits shall be

conducted according to government auditing standards issued by the

United States general accounting office. The department shall

develop performance audit procedures and reporting requirements

sufficient to determine whether funds money expended under this

section were was expended in compliance with this act by September

1, 2012 and shall report to the transportation committees of the

senate and house of representatives no later than October 1, 2012

on the additional audit procedures and reporting requirements. The

department shall provide notice to the county road commission,

county board of commissioners, or any other county governmental

agency acting as the county road authority, as applicable, of the

standards to be used for audits performed under this subsection.

The notice shall be provided 6 months prior to the fiscal year in

which the audit is conducted. The department shall notify the

county road commission, county board of commissioners, or any other

county governmental agency acting as the county road authority of

any subsequent changes to the standards. County road commissions,

county boards of commissioners, or any other county governmental

agencies acting as county road authorities, as applicable, shall

make available to the department the pertinent records for the

audit. Performance audits may be performed at the discretion of the

department or upon receiving a request from the speaker of the

house of representatives or the senate majority leader.

     (22) Of the amounts appropriated for a county primary or local

road system under this section, where possible, a county road

commission shall secure pavement warranties for full replacement or

appropriate repair guarantee for contracted construction work on

pavement projects whose cost exceeds $1,000,000.00 and projects for

new construction or reconstruction undertaken after the effective

date of the amendatory act that added this subsection, if allowed

by the federal highway administration and the department. A county

road commission shall submit a proposed warranty program to the

department for approval no later than September 30, 2015. If a

proposed warranty program submitted under this subsection is

approved by the department, the county road commission shall

implement the program no later than 1 year after the approval. A

county road commission shall include a list of all warranties that

were secured under this subsection and indicate whether any of

those warranties were redeemed with the report required under

section 14(3). The list shall include, but is not limited to, all

of the following information:

     (a) The type of project.

     (b) The cost or estimated cost of the project.

     (c) The expected lifespan of the project.

     Sec. 13. (1) The amount distributed to cities and villages

shall be returned to the treasurers of the cities and villages in

the manner, for the purposes, and under the terms and conditions

specified in this section. The amount received by a newly

incorporated municipality shall be in place of any other direct

distribution of funds money from the Michigan transportation fund.

The population of a newly incorporated municipality as determined

under this section shall be added to the total population of all

incorporated cities and villages in the state in computing the

amounts to be returned under this section to each municipality in

the state. Major street mileage, local street mileage, and

equivalent major mileage, if applicable, shall be determined by the

department before the next month for which distribution is made

following the effective date of incorporation of a newly

incorporated municipality.

     (2) From the amount available for distribution to cities and

villages during each December, an amount equal to 0.7% of the total

amount returned to all cities and villages under subsections (3)

and (4) during the previous calendar year shall be withheld. The

amount withheld shall be used to partially reimburse cities and

villages located in counties that are eligible for snow removal

funds pursuant to section 12a and that have costs for winter

maintenance on major and local streets that are greater than the

statewide average. The distributions shall be made annually during

February and shall be calculated separately for the major and local

street systems but may be paid in a combined warrant. The

distribution to a city or village shall be equal to 1/2 of its

winter maintenance expenditures after deducting the product of its

total earnings under subsections (3) and (4) multiplied by 2 times

the average municipal winter maintenance factor. Winter maintenance

expenditures shall be determined from the street financial reports

for the most current fiscal years ending before July 1. A city or

village that does not submit a street financial report for the

fiscal year ending before July 1 by the subsequent December 31 is

ineligible for the winter maintenance payment that is to be based

on that street financial report. The department shall determine the

average municipal winter maintenance factor annually by dividing

the total expenditures of all cities and villages on winter

maintenance of streets and highways by the total amount earned by

all cities and villages under subsections (3) and (4) during the 12

months. If the sum of the distributions to be made under this

subsection exceeds the amount withheld, the distributions to each

eligible city and village shall be reduced proportionately. If the

sum is less than the amount withheld, the balance shall be added to

the amount available for distribution under subsections (3) and (4)

during the next month. The distributions shall be for use on the

major and local street systems respectively and shall be subject to

the same provisions as funds money returned under subsections (3)

and (4).

     (3) Seventy-five percent of the remaining amount to be

returned to the cities and villages, after deducting the amounts

withheld pursuant to subsection (2), shall be returned 60% in the

same proportion that the population of each bears to the total

population of all cities and villages, and 40% in the same

proportion that the equivalent major mileage in each bears to the

total equivalent major mileage in all cities and villages. The

amount returned under this subsection shall be used by each city

and village for the following purposes in the following order of

priority:

     (a) For the payment of contributions required to be made by a

city or village under the provisions of contracts previously

entered into under 1941 PA 205, MCL 252.51 to 252.64, that have

been previously pledged for the payment of the principal and

interest on bonds issued under that act; or for the payment of the

principal and interest upon bonds issued by a city or village

pursuant to 1952 PA 175, MCL 247.701 to 247.707.

     (b) Payment of obligations of the city or village on highway

projects undertaken by the city or village jointly with the

department.

     (c) For the payment of principal and interest upon loans

received pursuant to section 11(5), to the extent other funds have

money has not been made available for that payment.

     (d) For the preservation, construction, acquisition, and

extension of the major street system as defined by this act

including the acquisition of a necessary right of way for the

system, work incidental to the system, and an appurtenant roadside

park or motor parkway, of the city or village and for the payment

of the principal and interest on that portion of the city's or

village's general obligation bonds that are attributable to the

construction or reconstruction of the city's or village's major

street system. Not more than 5% per year of the funds money

returned to a city or village by this subsection shall be expended

for the preservation or acquisition of appurtenant roadside parks

and motor parkways. Surplus funds money may be expended for the

development, construction, or repair of off-street parking

facilities, the construction or repair of street lighting, and

transfer to the local street system under subsection (6).

     (e) For capital outlay projects for equipment and buildings,

contributions pledged for the payment of loans and for the payment

of contractual debt service requirements for the payment of bonds

for the purpose of providing funds money for capital outlay

projects for equipment and buildings necessary to the development

and maintenance of the road system so long as amounts allocated

under this subdivision are used for transportation purposes.

     (4) The remaining amount to be returned to incorporated cities

and villages shall be expended in each city or village for the

preservation, construction, acquisition, and extension of the local

street system of the city or village, including the acquisition of

a necessary right of way for the system, work incidental to the

system, and subject to subsection (5), for the payment of the

principal and interest on the portion of the city's or village's

general obligation bonds that are attributable to the construction

or reconstruction of the city's or village's local street system.

The amount returned under this subsection shall be returned to the

cities and villages 60% in the same proportion that the population

of each bears to the total population of all incorporated cities

and villages in the state, and 40% in the same proportion that the

total mileage of the local street system of each bears to the total

mileage in the local street systems of all cities and villages of

the state. The payment of the principal and interest upon bonds

issued by a city or village pursuant to 1952 PA 175, MCL 247.701 to

247.707, and after that payment, the payment of debt service on

loans received under section 11(5), shall have priority in the

expenditure of money returned under this subsection.

     (5) Money distributed to each city and village for the

maintenance and preservation of its local street system under this

act represents the total responsibility of the state for local

street system support. Funds Money distributed from the Michigan

transportation fund shall not be expended for construction purposes

on city and village local streets except to the extent matched from

local revenues including other money returned to a city or village

by the this state under the state constitution of 1963 and statutes

of the this state, from funds money that can be raised by taxation

in cities and villages for street purposes within the limitations

of the state constitution of 1963 and statutes of this state, from

special assessments, or from any other source.

     (6) Money returned under this section to a city or village

shall be expended on the major and local street systems of that

city or village. However, the first priority shall be is the major

street system. Money returned for expenditure on the major street

system shall be expended in the priority order provided in

subsection (3) except that surplus funds money may be transferred

for preservation of the local street system. Major street funds

money transferred for use on the local street system shall not be

used for construction but may be used for preservation. A city or

village shall not transfer more than 50% of its annual major street

funding for the local street system unless it has adopted and is

following an asset management process for its major and local

street systems and adopts a resolution with a copy to the

department setting forth all of the following:

     (a) A list of the major streets in that city or village.

     (b) A statement that the city or village is adequately

maintaining its major streets.

     (c) The dollar amount of the transfer.

     (d) The local streets to be funded with the transfer.

     (e) A statement that the city or village is following an asset

management process for its major and local street systems.

     (7) A city or village that has not adopted an asset management

plan shall obtain the concurrence of the department to transfer

more than 50% of its major street funding to its local street

system. The department may provide for pilot projects that would

allow a city or village that has adopted an asset management plan

under subsection (6) to combine their local and major street funds

into 1 street fund and to submit a single report to the department

on the expenditure of funds money on the local and major street

systems.

     (8) Not more than 10% per year of all of the funds money

returned to a city or village from any source for the purposes of

this section may be expended for administrative expenses. A city or

village that expends more than 10% for administrative expenses in a

year is subject to section 14(5).

     (9) In each city and village to which funds are money is

returned under this section, the responsibility for street

preservation and the development, construction, or repair of off-

street parking facilities and construction or repair of street

lighting shall be coordinated by a single administrator to be

designated by the governing body who shall be responsible for and

shall represent the municipality in transactions with the

department pursuant to this act.

     (10) Cities and villages may provide for consolidated street

administration. A city or a village may enter into an agreement

with other cities or villages, the county road commission, or with

the state transportation commission for the performance of street

or highway work on a road or street within the limits of the city

or village or adjacent to the city or village. The agreement may

provide for any of the contracting parties to perform the work

contemplated by the contracts including services and acquisition of

rights of way, by purchase or condemnation in its own name. The

agreement may provide for joint participation in the costs if

appropriate.

     (11) Interest earned on funds money returned to a city or a

village for purposes provided in this section shall be credited to

the appropriate street fund.

     (12) In addition to the financial compliance audits required

by law, the department may conduct performance audits and make

investigations of the disposition of all state funds money received

by cities and villages for transportation purposes to determine

compliance with the terms and conditions of this act. Performance

audits shall be conducted according to government auditing

standards issued by the United States general accounting office.

The department shall develop all performance audit procedures and

reporting requirements sufficient to determine whether funds money

expended under this section were was expended in compliance with

this act by September 1, 2012 and shall report to the

transportation committees of the senate and house of

representatives no later than October 1, 2012 on the additional

audit procedures and reporting requirements. The audit procedures

shall include a review of the road fund balance of the city or

village. The cities and villages shall report their road fund

balances by fund balance component. The department shall assist

cities and villages to ensure that road fund balances are

consistently classified and are in compliance with the audit and

reporting requirements of this section. The department shall

provide notice to cities and villages of the standards to be used

for audits under this subsection prior to the fiscal year in which

the audit is conducted. The department shall notify cities and

villages of any subsequent changes to the standards. Cities and

villages shall make available to the department the pertinent

records for the audit. Performance audits may be performed at the

discretion of the department or upon receiving a request from the

speaker of the house of representatives or the senate majority

leader.

     (13) Of the amounts appropriated for a city or village major

or local street system under this section, where possible, a city

or village shall secure pavement warranties for full replacement or

appropriate repair guarantee for contracted construction work on

pavement projects whose cost exceeds $1,000,000.00 and projects for

new construction or reconstruction undertaken after the effective

date of the amendatory act that added this subsection if allowed by

the federal highway administration and the department. A city or

village shall submit a proposed warranty program to the department

for approval no later than September 30, 2015. If a proposed

warranty program submitted under this subsection is approved by the

department, the city or village shall implement the program no

later than 1 year after the approval. A city or village shall

include a list of all warranties that were secured under this

subsection and indicate whether any of those warranties were

redeemed with the report required under section 14(3). The list

shall include, but is not limited to, all of the following

information:

     (a) The type of project.

     (b) The cost or estimated cost of the project.

     (c) The expected lifespan of the project.

(14) (13) As used in this section:

     (a) "Administrative expenses" means expenses that are not

assigned under this section, including, but not limited to,

specific road construction or maintenance projects, and are often

referred to as general or supportive services. Administrative

expenses do not include net equipment expense, net capital outlay,

debt service principal and interest, or payments to other state or

local offices that are assigned, but not limited to, specific road

construction projects or maintenance activities.

     (b) "Equivalent major mileage" means the sum of 2 times the

state trunk line mileage certified by the department as of March 31

of each year, as being within the boundaries of each city and

village having a population of 25,000 or more, plus the major

street mileage in each city and village, multiplied by the

following factor:

     (i) 1.0 for cities and villages of 2,000 or less population.

     (ii) 1.1 for cities and villages from 2,001 to 10,000

population.

     (iii) 1.2 for cities and villages from 10,001 to 20,000

population.

     (iv) 1.3 for cities and villages from 20,001 to 30,000

population.

     (v) 1.4 for cities and villages from 30,001 to 40,000

population.

     (vi) 1.5 for cities and villages from 40,001 to 50,000

population.

     (vii) 1.6 for cities and villages from 50,001 to 65,000

population.

     (viii) 1.7 for cities and villages from 65,001 to 80,000

population.

     (ix) 1.8 for cities and villages from 80,001 to 95,000

population.

     (x) 1.9 for cities and villages from 95,001 to 160,000

population.

     (xi) 2.0 for cities and villages from 160,001 to 320,000

population.

     (xii) For cities over 320,000 population, a factor of 2.1

increased successively by 0.1 for each 160,000 population increment

over 320,000.

     (c) "Population" means the population according to the most

recent statewide federal census as certified at the beginning of

the state fiscal year, except that, if a municipality has been

newly incorporated since completion of the census, the population

of the municipality for purposes of the distribution of funds money

before completion of the next census shall be the population as

determined by special federal census, if there is a special federal

census, and if not, by the population as determined by the official

census in connection with the incorporation, if there is such a

census and, if not, by a special state census to be taken at the

expense of the municipality by the secretary of state pursuant to

section 6 of the home rule city act, 1909 PA 279, MCL 117.6.

     Sec. 14. (1) Each county road commission and city and village

of the state shall prepare biennial primary road and major street

programs, based on long-range plans, and shall make the programs

available for review by the public.

     (2) Separate accounts shall be kept by cities, villages, and

county road commissions of all money returned from the Michigan

transportation fund. This subsection shall does not be construed to

prevent the combining of accounts on which separate bookkeeping

records are kept into a single deposit account.

     (3) All county road commissions and cities and villages shall

keep accurate and uniform records on all road and street work and

funds, and shall annually report to the state transportation

department at the time, in the manner, and on forms prescribed by

the state transportation department the mileage of each road system

under their jurisdiction and the receipts and disbursements of road

and street funds. In the annual report, each county road commission

shall report on its compliance in the preceding year with the

requirements of section 12(16) and (17). The report shall also

specify, with respect to section 12(17), the total dollar amount

expended for other than maintenance purposes which would not have

been permissible without the deduction of certain urban route

expenditures as permitted under section 12(17). The report shall

also specify the justification for a waiver of the requirement of

section 12(17), if that requirement was waived. A county road

commission, city, or village shall post the report required by this

subsection on its website, if the county road commission, city, or

village has a website.

     (4) The expenditure of adequate amounts, by county road

commissions and the cities and villages , are authorized to expend

adequate amounts from funds returned by this act , to cover the

cost of administration, engineering, and record keeping, is hereby

authorized, and expenditures for those purposes shall be reported

separately by each county road commission, city, and village to the

state transportation department.

     (5) All distributions and returns of funds provided for in

this act shall be withheld from the state transportation

department, eligible authorities, county road commissions, cities,

villages, or other eligible governmental agencies for failure to

comply with any of the requirements of this act, and the

withholding shall continue for the period of noncompliance.

     (6) Money distributed to county road commissions for the

maintenance and improvement of county local road systems pursuant

to section 12 represents the total responsibility of the this state

for local county road support. Additional funds required for the

support of county local road systems may be supplied from other

money returned to the township governments by the this state under

the state constitution of 1963 and statutes of the this state, or

from funds that can be raised by taxation in the townships or

counties for road purposes within the limitations of the state

constitution of 1963 and statutes of the this state.

     Enacting section 1. This amendatory act does not take effect

unless House Bill No. 5477 of the 97th Legislature is enacted into

law.